How Investing In R&D Can Resuscitate Economic Growth And The American Dream
The American engine of prosperity and progress has been in serious trouble over the last couple of years. Job creation has slowed down, causing a slow hollowing out of the middle class. In the meantime, economic and wealth opportunities are concentrated in a handful of coastal megacities, making people from the rest of the nation feel excluded.
How did our nation get here? And is there anything we can do to turn this tide?
In a new book (Jump-Starting America) and article posted on The Boston Globe, Simon Johnson and Jonathan Gruber provide answers to both questions. The book, in particular, presents an ambitious strategy that will boost public funding in Scientific Research and Development (R&D) in most societies around the nation.
Johnson with PIIE & MIT and Gruber with MIT argued that the U.S. can create more good jobs, grow faster, and sincerely spread equal opportunities than it has in the past if the administration is willing to change how and how much it invests in R&D.
The two MIT Economists further pointed out that the nation should place those investments equally and strategically across the U.S. and come up with an innovation dividend that will pay cash to Americans each year based on their success to invest the funds in the tech sector.
Johnson and Gruber claim doing so will result in a tech boom (similar to the one witnessed in the United States after World War II) and its benefits will be shared more broadly across the country.
“The United States needs once again to boost its leadership role in science. To do so we should recognize a fact that may be uncomfortable or some: More government spending on R&D will not fly politically if it all goes to the existing technological hubs of today,” wrote the two in the Boston Globe article. “The best technology jobs that we have today are concentrated disproportionately in a small number of superstar cities primarily on the West and East coasts: Boston, New York, Washington, Seattle, San Francisco, and Los Angeles.”