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Is US Losing Innovation Race Against China and India?

A magnetic levitation or 'Maglev,' train running on a test rail in Shanghai, China (file photo))

U.S. President Barack Obama is expected to travel to the Western states of California and Oregon this week to meet with the heads of leading high-tech companies. His trip comes just weeks after the president outlined plans in his State of the Union Address to put more emphasis on innovation and education. To learn more about the significance of the trip and whether the United States is losing its competitive edge against emerging economic powerhouses like India and China, VOA's William Ide spoke with Adam Segal at the Council on Foreign Relations in New York. He is the author of the new book: Advantage: How American Innovation Can Overcome the Asian Challenge.

IDE: Increasingly, there is an assumption that the United States is losing its edge to China and India, and that it is on the decline. What are the recent developments that seem to support that assumption?

SEGAL: "I think people point a lot to the numbers coming out, especially about China - so for example the PISA [Program for International Student Assessment] test out of Shanghai, where Shanghai high schoolers scored higher on math and science than we expected. The patent numbers - China is now the number two patent filer in the world, past Japan. I think they look at things like wind turbines and solar energy and how the Chinese are dominating those markets as well as high-speed rail. So I think all of those things are shown as evidence that China, in particular, is closing the gap."

IDE: But you don't agree with that assumption? And that's the topic of the book you recently released.

SEGAL: "That's right. I basically make a distinction between what I call the "hardware" and the "software" of innovation. The hardware are the things that I've mentioned - easily measurable metrics such as papers and patents and all these things. And the software are the political, social and cultural understandings that help move ideas from labs to the market place. And then if you look at China and India, you see that those are harder to build. For example, on the publication side, this week we also had a major story out of China about academic fraud and plagiarism, which has been a huge problem. On the patent side, yes, the Chinese have increased the number of patents. But the quality of the patents is actually very low and most of them are actually filed for other reasons. So if you look at these kind of [questions] - How do you train a scientist? How you help start up companies? How do you protect intellectual property rights? - you see that there is a long way to go to build these things in China and India. And that's why I am less pessimistic about what the U.S. can do."

Why are trips like the one that President Obama is making to Silicon Valley in the San Francisco area important? Or are they not that important?

SEGAL: "I think they clearly are slightly symbolic and a lot about public relations. But I do think they are important in the sense that the president needs to build a narrative about what our strengths are and what we need to do to compete. And I think innovation is clearly at the top of that list and I also think that it is important that people realize this is an area of strength for us. If you look at how innovation is changing, it is becoming more globalized, spread around the world to all of these newly emerging science and technology centers in China and India. And the U.S., in fact, is well positioned to take advantage of those. We have extensive connections to all of those places through alumni networks, university collaboration and corporate networks. I think the U.S. is better positioned than any country to take advantage of this kind of new global system of science and technology. So I think it's important for the president to point to our strengths and some of the things we need to do as we move forward."

IDE: How is China pulling ahead and how much further does it have to go before it could surpass the United States?

SEGAL: "It is clearly making gains in areas that are going to be important in the future. I think the one [area] that gets the most attention, of course, is new energy - wind turbines and solar panels. Both of those really have more to do about scale - the Chinese ability to deploy in large numbers those technologies and drive the price down. There hasn't been really a significant breakthrough on the technology side from Chinese producers and I don't expect one in the near term. I think the greatest threat from China in the near term - and again, I don't necessarily think we need to perceive it as a threat - where we might see some breakthroughs are probably in telecommunications and nano [technology], where the Chinese have produced a great deal of papers and are doing a great deal of work. I think if you look across the board at the Chinese economy, they are several decades behind the U.S. on the technological front. And I expect that that will remain that way for quite some time."

IDE: President Obama in his recent State of the Union address spoke about the importance of education and innovation, and "winning the future" by out-innovating the rest of the world. What is it that the United States needs to do more of to maintain its edge in innovation?

SEGAL: "I think part of the problem moving forward is going to be money. The one area of President Obama's budget that wasn't heavily cut was research and development spending of the National Science Foundation and the Department of Energy. And in fact, both of those were increased. But if those are going to survive the budget process - and Republicans in the House of Representatives seem intent on cutting that - is going to be a major issue. Just having the resources, I think, is going to be a serious issue for the U.S. moving forward. There has also been a lot of talk about how we need to have more scientists and engineers in the United States, that China and India are eventually going to train more people and pass us. I think that is partly the right answer. But I think the real thing we need to be focusing on is: what it is we are actually training our engineers and scientists to do, what type of skills they have and, increasingly, do they have international experience."