House Democrats unveiled a plan last month they say will encourage innovation and promote American competitiveness. Is there real promise behind the words?
Called “The Innovation Agenda: A Commitment to Competitiveness to Keep America No. 1,” the plan says it contains the solutions that will “ensure that America remains the world leader” in technological advancement and innovation.
If the Democrats have come around to the notion that the U.S. must be the world’s innovation leader, we applaud them.
However, Lesson No. 1 in creating a framework for innovation leadership is to recognize that the private sector – especially small entrepreneurs with big ideas – is where most innovation originates.
Lesson No. 2: Government really doesn’t have to do much but provide a hospitable entrepreneurial environment and then get out of the way.
Is that what the Dems propose? Let’s see.
- The plan includes increased funding of government agencies, such as the National Science Foundation, and cash thrown at politicized energy research.
OK, well that one was a miss.
- The Democrats also want to “Guarantee affordable access to broadband technology for all Americans,” which sounds nice but will cost taxpayers and would steal private companies’ opportunities to do business.
- The Innovation Agenda proposes to “Create a special visa for the best and brightest international doctoral and postdoctoral scholars in science, technology, engineering and mathematics.”
That’s an idea worth supporting.
- But what about the plan to “Modernize and permanently extend a globally competitive R&D tax credit to increase domestic investment, create more U.S. jobs, and allow companies to pursue long-term projects with the certainty that the credit will not expire.”
Well, while tax credits add complexity to the tax code, a tax credit is not as egregious as outright forms of corporate welfare. The R&D tax credit is at least helpful for key U.S. industries, and is a useful concession until such time as corporate tax policy is reformed.
- On the positive side, they claim to want to remove some of the regulatory hurdles for small business is right on track.
But that raises a question: If lighter regulation will benefit small business, wouldn’t big business get similar benefits from fewer rules?
All in all, it seems “The Innovation Agenda” is well-intentioned but fails to grasp the two principal lessons mentioned above. And you know what they say about roads paved with good intentions.