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Two MIT Economists Share A Bold Plan To Jump-Start The Economy In New Book
April 9, 2019 | Boston Public Radio | By Arjun Singh

On paper, America’s economy seems to be excelling. In March, the economy added 196,000 new jobs while the unemployment rate sat at 3.8 percent. Meanwhile, American startups like Uber and Pinterest are expected to go public with multi-million or higher valuations. But MIT economists Jonathan Gruber and Simon Johnson believe this hides a darker truth about the American economy: It’s slowly falling behind the rest of the world.

In their new book, “Jump-Starting America: How Breakthrough Science Can Revive Economic Growth and the American Dream,” Gruber and Johnson lay out their plan for how the United States can reclaim its mantle as a leader in not just gross domestic product, but also innovation and science. The key, they say, is government investment and encouragement in the scientific sector.......The economists are optimistic, however, that the United States can regain its lead and eventually develop a robust economy that sees economic growth and investment in the sciences. And not just in places like Boston or San Francisco, but throughout the rest of the country, where Johnson says there is a wealth of untapped talent and potential. They estimate there are at least 102 potential scientific hubs scattered across the U.S.

“The coastal superstar cities have become extremely expensive, but there’s a tremendous amount of talent spread across the U.S.,” Johnson said. “Good living conditions also matter. People also want to live in a place [with a] good climate, much better commute times than you have in the megacities, and low crime rates. Those are our very simple, transparent criteria.”..... public investments in research and development contribute to what the authors call the “spillover effect.” When the product of the research is not a private firm’s intellectual property, its impact flows across the economy.
books  breakthroughs  coastal  competitiveness_of_nations  economists  industrial_policies  innovation  jump-start  MIT  moonshots  NSF  public_investments  R&D  science  Simon_Johnson  spillover  superstars  U.S. 
august 2019 by jerryking
Lunch with the FT: Mariana Mazzucato -
August 14, 2015 12:07 pm
Lunch with the FT: Mariana Mazzucato
John Thornhill

* Mazzucato’s book The Entrepreneurial State

As Mazzucato explains it, the traditional way of framing the debate about wealth creation is to picture the private sector as a magnificent lion caged by the public sector. Remove the bars, and the lion roams and roars. In fact, she argues, private sector companies are rarely lions; far more often they are kittens. Managers tend to be more concerned with cutting costs, buying back their shares and maximising their share prices (and stock options) than they are in investing in research and development and boosting long-term growth.
“As soon as I started looking at these issues, I started realising how much language matters. If you just talk about the state as a facilitator, as a de-risker, as an incentiviser, as a fixer of market failures, it ends up structuring what you do,” she says. But the state plays a far more creative role, she insists, in terms of declaring grand missions (the US ambition to go to the moon, or the German goal of creating nuclear-free energy), and investing in the early-stage development of many industries, including semiconductors, the internet and fracking. “You always require the state to roar.”
... Some tech and pharmaceuticals companies are going to extravagant lengths to reduce their taxes, one of the ways in which they pay back the state. The more libertarian wing of Silicon Valley is even talking of secession from California so they can pay no tax at all. “Won’t it be nice when there’s the next tsunami and these guys call the coastguard,” she says....
One criticism of Mazzucato’s work is that she fetishises the public sector in much the same way that rightwing commentators idolise the private sector. She appears stung by the suggestion: “I’m from Italy, believe me, I don’t romanticise the state.” The challenge, she says, is to rebalance the relationship between the private sector, which is all too often overly financialised and parasitic, and the public sector, which is frequently unimaginative and fearful. “When you have a courageous, mission-oriented public sector, it affects not just investment but the relationships and the deals it does with the private sector,” she says. Europe’s left-wing parties could have run with this agenda. Instead, she says, they have “absolutely failed” to change the political discourse by obsessing about value extraction rather than value creation, by focusing more on taxing big business than fostering innovation.

The Chinese get the state to do that risky and costly, research and the development to keep them ahead.

The US does the same, but just keeps quiet about it so it doesn’t spoil the narrative.
“The parts of the smart phone that make it smart—GPS, touch screens, the Internet—were advanced by the Defense Department. Tesla’s battery technologies and solar panels came out of a grant from the U.S. Department of Energy. Google’s search engine algorithm was boosted by a National Science Foundation innovation. Many innovative new drugs have come out of NIH research.!”
activism  books  breakthroughs  DARPA  de-risking  Department_of_Energy  early-stage  economists  fracking  free-riding  innovation  Mariana_Mazzucato  mission-driven  moonshots  NIH  NSF  private_sector  public_sector  semiconductors  Silicon_Valley  sovereign-risk  state-as-facilitator  value_creation  value_extraction  women 
august 2015 by jerryking
Fly Me to the Moon
December 5, 2004 | NYT | By THOMAS L. FRIEDMAN...."give me an America that is energy-independent and I will give you sharply reduced oil revenues for the worst governments in the world. I will give you political reform from Moscow to Riyadh to Tehran. Yes, deprive these regimes of the huge oil windfalls on which they depend and you will force them to reform by having to tap their people instead of oil wells. These regimes won't change when we tell them they should. They will change only when they tell themselves they must....If President Bush made energy independence his moon shot, he would dry up revenue for terrorism; force Iran, Russia, Venezuela and Saudi Arabia to take the path of reform - which they will never do with $45-a-barrel oil - strengthen the dollar; and improve his own standing in Europe, by doing something huge to reduce global warming. He would also create a magnet to inspire young people to contribute to the war on terrorism and America's future by becoming scientists, engineers and mathematicians. "This is not just a win-win," said the Johns Hopkins foreign policy expert Michael Mandelbaum. "This is a win-win-win-win-win."
career_paths  deprivations  energy  energy_independence  energy_security  engineering  mathematics  moonshots  NSF  oil_industry  petro-politics  SAIS  STEM  Tom_Friedman  win-win  youth  young_people 
january 2012 by jerryking

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