With the globalization of technology
across states, the demand for skilled employees and a vibrant technological
education infrastructure raises unique challenges for maintaining the United
States’ leadership in tech development and for retaining US economic leadership
in the global tech industry. In 1995, American computer scientists, Jim Clark
and Marc Andreessen, launched Netscape: the first publicly available Internet
browser. The creation of Netscape signaled both the beginning of the dot-com
bubble and the beginning of the first medium to instantaneously transmit data
across borders. According to Thomas Friedman, Pulitzer Prize-winning columnist
for the New York Times, Netscape’s launch acted as a watershed moment both for
the American tech sector for IT (information technology) sectors abroad (Friedman).
As Netscape grew in popularity, fiber optic cables reached across borders and
lowered the barrier for entry into the tech market, allowing countries like
China and India to develop massive quantities of highly qualified workers at
little cost.
After the Y2K bug reached servers in 2000, the
IT work typically delegated to American software developers were outsourced to
workers in India and China, creating both an interdependence between the United
States and these East Asian powers while revealing an emerging competition over
economic dominance in the tech industry. Since Y2K, the United States has
witnessed a growing enthusiasm gap between itself and its geopolitical rivals
over STEM (science, technology, engineering, and math) education. The
percentage of total American undergraduates majoring in STEM fields has fallen
from 32% in 1995 to 27% in 2005 (Lips). Faced with global issues, and dependency
on technological solutions, a question emerges about how the United States can
make itself stand out in a world crowded by more competitive and enthusiastic
states.
A primary source of technology
diffusion is the outsourcing of software engineers and data centers overseas.
Of the three large East European and Asian superpowers (India, China, and
Russia), India has seen the most staggering growth in information technology.
Since the 1990s, India has seen an average annual growth of 40% in software
exports, expanding its export revenue from $7.7 billion in 1990 to around $50
billion in 2008 (Sahay). Moreover, while in 1990, five percent of the software
development process was completed in India (with 95% being completed in the
United States), by 1995, Indian engineering accounted for 70% of the software
development process (Ibid). China, with the world’s largest potential pool of
human resources, has witnessed incredible growth in the IT industry. Backed by
a growth-obsessed government, China’s software industry counts 400,000
employees and harbors predictions of economic growth to rival that of India in
the coming years (Ibid). Although initially late to the dot-com bubble, Russia
has grown into a formidable technological competitor. Russia regularly competes
with the United States for software contracts and has seen an influx of Fortune
500 companies relocate to Russia for its competitive wages and highly educated
workforce (Ibid). India, China, and Russia’s astonishing growth in software
developers and engineers reveals a global prioritization of technology that the
US is failing to come to terms with.
The second major factor explaining
the decline of American preeminence in technology is the international focus on
STEM education. After World War II, the United States ascended to superpower
status on the back of its growing industrial and technological sector. Since
2000, sagging innovation has allowed other nations to fill the vacuum with
highly motivated citizens immigrating to the United States for its educational
opportunities and returning to their home countries to fund ventures that compete
with US companies. In India, the social stigma around failure and the security
of the tech industry drives students to complete engineering degrees at a rate
unparalleled in the United States (Wadhwa). Moreover, Indian enthusiasm for
technological development and its ready source of qualified graduates has
attracted 265 Fortune 500 companies to establish headquarters in India (Sahay).
Although India currently has the largest domestic tech infrastructure, China
has the largest STEM-oriented educational system. In 2001, 18.8% of Chinese students who
studied a STEM field in the United States ended up returning to China upon
graduation (Ibid). The emigration of educated student, known colloquially as
the “brain drain”, allows Chinese entrepreneurs to transfers their
technological skills, industrial connections, and physical technological systems
back to China.
Russia, driven by the failure of the Cold War
to compete with the United States, poses the largest education threat to the
United States in the tech sector. Given a massive pool of scientists educated
in space, nuclear, and engineering systems since the end of World War II,
Russia has unmatched enthusiasm and resources devoted to reinvigorating its
domestic tech sector. Currently, Russia boasts the third-largest per capita
scientists and engineers in the world, a large ethnic population that fosters
cross-cultural communications with India, China, and European states, and
salaries around half of the Indian median salary (Ibid). These two factors
create problems for US competitiveness that has declined marketed since the end
of the Cold War.
An uncompetitive US tech sector has
numerous potential consequences if left unfixed. Primarily, the US loses
critical economic strength, which translates directly to soft-power influence
over other states and economies. Without a revitalized tech sector, other
countries enter a positive feedback loop whereby if the United States continues
to lose jobs, new generations of engineering students will become incentivized
to move away from the United States to complete their education and pursue
engineering careers. Furthermore, the United States loses the economic power to
motivate other nations to cooperate over multinational tech projects and
institutions while getting shut out of a critical global market.
The United States also faces major
national security risks without a competitive technological industry. Firstly,
a “brain drain” in domestic engineers guts the already-feeble aerospace sector
in the United States. With projected defense spending cuts by the Obama
administration and the lack of a coherent vision for the future of the
aerospace industry, engineering students have displayed waning enthusiasm for
what is seen as an outdated industry (Charette). However, the United States forgoes
a major research and development sector while losing an air force necessary to
provide flexible military operations abroad that help the United States pursue
its realist objectives (Lips).
Secondly, a suffering tech sector leaves the
United States vulnerable to cyber-security risks that could potentially exploit
critical servers with national implications. In June 2007, intelligence
agencies traced to China hacked multiple US government networks and leaked
sensitive documents to an unknown website in China (Lips). In that same month,
a different group of Chinese hackers managed to penetrate the Department of
Defenses computer defenses and accessed various security documents (Ibid). The
growth of STEM education abroad has combined technological fluency with a
nationalistic desire that critically undermines the competitiveness and
security of the United States in anarchic world.
The question of the flagging US technology
sector in the face of escalating globalization asks what the United States can
do to regain its former competitive edge. Thus, I advocate a three-pronged
approach: a sizable increase in funding for STEM education in the United
States, an increase in available visas, and a massive technological public
works project within the aerospace industry. The first part of the approach
provides the capabilities for a new generation of students to pursue
engineering and tech professions to develop its technological human resources.
The second part seeks to lower the barrier to working in the United States,
which hinders the ability of skilled foreign workers to bring their
technological expertise to the United States. While China, India, and Russia
have loose restrictions that easily allow large companies and workers to move
abroad, the United States’ visa system discourages workers from working
domestically (Lips). While a large number of capable applicants are necessary
for a powerful tech sector, the final component provides the critical
motivation for these workers to pursue a tech career. Following the footsteps of
the Manhattan and the Apollo projects, the United States needs to provide a
massive public works project (ie. renewable energy structures, NASA projects,
revolutionary infrastructure) to spur enthusiasm for technology and recapture
the imagination of American students. Armed with a motivated and expansive
workforce, the United States’ can recapture the global leadership experienced
after World War II.
Works
Cited:
Charette,
Robert. “STEM Education Funding in the US – Is More or Less Needed.” Spectrum. 8 June 2012.
<http://spectrum.ieee.org/riskfactor/at-work/education/stem-education-in-the-us-is-more-or-less-needed>
Friedman,
Thomas. “It’s a Flat World After All.” New
York Times. 3 April 2005.
<http://www.nytimes.com/2005/04/03/magazine/03DOMINANCE.html?_r=0&pagewanted=print&position=>
Lips,
Dan and Jean Baker McNeil. “A New Approach to Improving Science, Technology,
Engineering, and Math Education.” The Heritage Foundation. 15 April 2005.
<http://www.heritage.org/research/reports/2009/04/a-new-approach-to-improving-science-technology-engineering-and-math-education>
Sahay,
Sundeep, Brian Nicholson, and S. Krishna. Global
IT Outsourcing: Software Development Beyond Borders. Cambridge: Cambridge
University Press, 2003.
Wadhwa,
Vivek. “The Future of Indian Technology.” Techcrunch.
10 November 2010.
<http://techcrunch.com/2010/11/13/the-future-of-indian-technology/>
You seem to portray the United States as having lost almost all of its standing as a power in the STEM industries, but what about the various companies now that are based in the United States? Given their increasing outsourcing and participation in the system of comparative advantage, how do you see their participation in the global system changing if the power is to shift from the US? It seems that there will continue to be a strong STEM sector in the US, but it will be less constrained to the boarders of the state.
ReplyDeleteYour proposal to increase the availability of visas is where this seems most applicable. Don't those experts, though they may not be within the boundaries of the US, contribute to the US's power by their affiliation to the US companies which reach out and recruit in other states? In the Friedman article, he mentions that competition for a job at Google in China is incredibly intense, leaving hundreds of applicants without a position, creating large pools of adept STEM workers out of work. It is situations like this that seem to show that even though other countries are growing in STEM fields, they are not immune to the same problems that the US has, and can be susceptible to the fluctuations in demand that the US is currently feeling. I feel like this should be addressed in your argument, which currently seems to assume that the rise in power of other countries has almost phased the US out of significance, which isn't entirely true.
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DeleteAlright, your questions are multipart, so I'll try to deconstruct it a bit and respond from there:
Delete1) While the US still plays host to many tech companies, my post is supposed to highlight the growing trend away from incorporation in the United States. Even if the US is still competitive now, status quo policies ensure that the United States will lose its tech leadership in the coming years to countries like India, China, and Russia at a more rapid pace than expected.
2) Regarding outsourcing and comparative advantage, it's true that the United States has given up their manufacturing leadership to other countries, but the post is supposed to highlight how the US is losing what it thought it was supposed to have a comparable advantage in: software development and highly-skilled engineers. If the US fails to maintain the edge in software development witnessed during the late-90s and early 2000s, it'd need to (rather desperately) find another portion of the industry to find an advantage to participate in the global tech market. Boiled down, while the 90s and 2000s had other nations establishing their tech niche in manufacturing and production, the US's niche was in development and engineering, which other countries are becoming far more competitive in in the last few years.
3) This'll sort of address the second paragraph. The trend towards companies emigrating abroad to China, India, Russia, etc. short-circuits the argument that affiliations with other nations only strengthens US power. Even if China has a large pool of adept STEM workers, the growing trend of Fortune 500 companies incorporating in foreign states shows how other states are adapting to the growing supply of foreign engineers better than the United States. If anything, China suffers from a lack of demand while the US suffers a lack of supply, which China is better equipped to fix. Moreover, although you are right that the US reaches out and recruits from other states, tech is necessarily a multi-faceted and multi-national process. In a field that used to require unique tools and research only found in the United States, those resources and expertise can instantaneously exported abroad and allows other nations to grow their involvement in the tech process. These trends culminate in a decline in US leadership relative to other states in the tech industry.
I found your article very interesting, especially concerning Russia and its technological and software infrastructure. Since the Cold War, there has been a marked decrease in Russian manufacturing and innovation - and that is why the Russian government has recently approved massive investment from the state into domestic research institutions and private-sector technology companies. Do you think that that is what the U.S. should do? Is it the responsibility of the government to pick up the enthusiasm of its citizens and encourage them to work in a field they are otherwise likely not to work in? Should the government take it upon itself to re-invigorate a private sector that has recently seen massive decline due to partly voluntary (as you say people are leaving) actions? I understand that our STEM education should be revamped, but the U.S. is still home to some of the most respectable tech school in the world - MIT, GT, CalTech. How do we keep students from foreign countries from leaving, too? Is it the U.S. that should incentivise for them to stay or private companies? And finally, I think that the problem is simply that the population of the U.S. is so much smaller than India and China. Perhaps there's no way of tightening that brain-drain gap because top academicians came to the U.S. following WWII, but those same people want to stay in their country of origin because living standards have improved, and they are not persecuted for their political or ethnic identities. How do you propose to fix that situation to favor the U.S. once again (instead of their home countries or a stable E.U.? How do we get the Einsteins to leave an ethnically accepting China or the next Sikorsky to work for NASA or Boeing in America instead of the Indian aircraft industry?
ReplyDeleteAlright, I'll group the first few questions since they relate to a similar argument in the post. I agree that the US should increase funding for domestic research institutions as a component of increasing funding for STEM education, but the question of funding private-sector companies is another can of worms regarding the government picking winners in an industry that's beyond the scope of this post. If we agree that flagging motivation is a primary factor for the slumping industry, then I think it is the government's responsibility to bolster enthusiasm for technology because it's the only domestic actor with that capability. The Manhattan Project of the 1940s and Apollo Project of the 1960s are great examples of the government's power role in enthusiasm. After both projects were introduced, the United States witnessed a generation of students fascinated by the seemingly infinite limits of US scientific endeavor and pursued occupations that worked on projects similar to these. If the United States replicated a project similar to the scope of sending a man to the moon or building the first nuclear weapon, that will likely reproduce the wave of engineers witnessed during the 40s and 60s.
DeleteAs for the second part of your question about retaining foreign students, I feel that we can only access the benefits of our respectable tech universities if we can loosen up the visa process that forces foreign students out after their terms are complete. Moreover, the funding for K-12 STEM education ensures that we're not squandering what valuable resources we have in collegiate STEM education we have.
In order to retain the next Einstein or Sikorsky, we have to provide a reason for them to favor working in the United States over their countries of origin. Even if the living conditions are better in their home countries, if the United States provides comparatively better opportunities and projects that require their expertise that they can't find back home, then the United States can reify its position as a global innovator.
Thanks for your interesting post Patrick! I agree with you in one of your proposed solutions: that we make it easier for foreigners to settle down and work in America. Though it is important that we bolster our own STEM education, it seems as though it is not a failure of our education system that is causing our decrease in technological competition. Rather, it seems to be the caused by the lack of interest of the US people in studying STEM subjects. Maybe the solution is simply to allow foreign engineers to become citizens and work in the US without restrictions. How do you think a realist and a liberalist would view this solution?
ReplyDeleteI feel there are two questions to answer here: how to reinvigorate interest in STEM subjects and how a liberal/realist would view massive immigration for the sake of tech competitiveness. As for the first question, the sagging interest in the tech industry can be traced to a lack of motivation and commitment on the part of the federal government. As I wrote in the conclusion of the post, if the United States committed to a massive scientific endeavor on the scale of the Manhattan or Apollo projects, then we'd generate the renewed interest in technology seen during the 40s and 60s. Secondly, how would a liberal and a realist view this issue. As far as realism, I think the US would gladly accept citizens to work in the US without restrictions because those workers are directly related to bolstering US power. Either by using STEM expertise for hard power arenas like the aerospace or defense industry to the economic influence the US gains with a powerful tech industry, the power benefits of a strong engineering base outweighs possible abstract threats to sovereignty by an influx of foreign workers. I believe liberals would also favor this solution because it allows the US to take the lead on multilateral tech agreements and institutions. When the US has a massive, multinational working base domestically, it gains influence over countries where these workers have emigrated and gains economic interdependence and security with these states.
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