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Why The CHIPS Act May Be A Turning Point For Innovation In America

2022 August 14
by Greg Satell

In every conceivable sense, the United States is a divided country. Congress, almost evenly split between two parties, seems permanently mired in rancor and gridlock . Our government struggles to put out a budget each year without shutting down. The notion that we can forge an actual vision for the future of the country often seems like some sort of nostalgic pipe dream.

That’s why the overwhelming support for the CHIPS Act is as puzzling as it is encouraging. After years of neglect of—and in some cases outright hostility to—government funding of science, the legislation, which passed the Senate by a margin of 64-33 and was signed by President Biden. It has the potential to be truly transformative.

Ironically, we may have China to thank for it. Since the end of the Cold War, the US has lacked an organizing principle and, to a great extent, a true sense of mission. Lacking a long-term vision, we’ve neglected investments in infrastructure, science and technology. Now, however, the tide may be turning and, if history is any guide, we’ll be all the better for it.

An Unlikely Path To Scientific Technological Dominance

At the beginning of the twentieth century, the United States was an industrial and technological backwater. Still mostly an agrarian nation, bright young students would often have to go to Europe to pursue advanced degrees in the sciences, because American universities were considered to be second-rate.

Yet as America industrialized, that began to change. By the 1920s, fortunes coming from industrialists such as Rockefeller, Ford, Carnegie and others began to create healthy endowments at universities. By the 1930s, with Europe increasingly in turmoil, world-class scientific talent began to flock to our shores.

In 1940, Vannevar Bush, who at the time was serving as President of the Carnegie Institution for Science, went to see President Roosevelt. His message was twofold. First, that the war that was ravaging Europe would soon include the United States—a point that Roosevelt did not need to be convinced of. Second, that the would not be won with bombs and bullets alone, but with science as well.

The conversation eventually led to the establishment of the Office of Scientific Research and Development (OSRD, which mobilized the country’s scientific resources by extending grants to outside researchers to develop technology for the war effort. It was, by all accounts, a resounding success, resulting in breakthroughs such as radar, the proximity fuse and, most famously, the atomic bomb.

In less than half a century, America had gone from scientific laggard to unparalleled leader.

Science, The Endless Frontier

As the war was winding down, Roosevelt asked Bush to write a report proposing how America could continue the success of the OSRD in peacetime. That report, Science, The Endless Frontier, was delivered to President Truman in 1945 and would set the stage for America’s technological dominance during the second half of the century.

Bush’s report did far more than document the success of a government program. It set forth a new vision in which scientific advancement would be publicly funded, but made available for private purposes in order to create newfound prosperity. He wrote:


Basic research leads to new knowledge. It provides scientific capital. It creates the fund from which the practical applications of knowledge must be drawn. New products and new processes do not appear full-grown. They are founded on new principles and new conceptions, which in turn are painstakingly developed by research in the purest realms of science.


The influence of Science, The Endless Frontier cannot be overstated. It led to the creation of new government agencies, such as the National Science Foundation (NSF), the National Institutes of Health (NIH) and the Defense Advanced Research Projects Agency (DARPA).

Perhaps even more importantly, it created an innovative mode: publicly funded science—controlled by scientists not politicians—benefit private industry—that has proven to be a competitive advantage.

Today, it is hard to go through a single day without being touched by science created by Bush’s vision. The Internet and GPS satellites were originally developed at DARPA, most blockbuster drugs, including mRNA vaccines, get their start with research funded by the NIH. Google itself arose out of an NSF grant.

Much as Bush envisioned, new knowledge invariably led to new prosperity.

The  War On Science

Despite the obvious success of America’s investment in basic science and even empirical data pointing to its impressive return on investment, the end of the Cold War brought an increasing skepticism about science. In fact, many politicians began to see money spent on research as a convenient political target.

Perhaps the most prominent critic was Senator Tom Coburn who released a scathing report called National Science Foundation: Under the Microscope. Although politically persuasive, many experts found it disingenuous to the point of mendacity, putting serious science in a negative light by deliberately misrepresenting the context of scientific studies.

Many others piled on. Paul Broun, a US Congressman, asserted that evolution, embryology and big bang theory are “lies straight from the pit of hell.” Senator Marco Rubio proudly questioned the relevance of science in everyday life. It became something of a sport to summon working scientists to be grilled in front of congressional committees.

Perhaps not surprisingly, by 2020 US government investment in R&D had fallen to a 60-year low, even as China steadily increased its commitment to science and technology.

A New Organizing Principle

Vannevar Bush’s vision during World War II helped the United States become a leader in science and technology. The Cold War helped further that notion that government should invest in science as a public good for private benefit. So, in a sense, maybe it shouldn’t be surprising that when we became a lone superpower, we got thrown off our game.

Yet a rising China and, to a certain extent, the role of science in developing vaccines to help end the pandemic, have served as a new organizing principle. Just as the Soviet launch of Sputnik helped make a political case for the massive investment in the space program, today’s rising superpower has the potential to push us to greater things.

While most of the attention surrounding the recently signed CHIPS Act has been focused on semiconductors, only $54 billion, or less than a quarter of the $280 million, goes to making computer chips. The vast majority will be invested in research, industrial capacity and workforce development, all of which are sorely needed.

We need to come to terms with what an incredible disappointment the digital revolution has been. It left the average American poorer, sicker and less happy than a generation ago. Today, with vastly more powerful technologies, including synthetic biology, materials science, quantum computing, we have the opportunity to do better.

Let’s not squander it. We need to abandon the cult of disruption and embrace the pursuit of grand challenges. Hopefully, we will someday look back and say, “that was the turning point in which we asked more of ourselves and, seemingly against the odds, delivered.”


Greg Satell is a transformation & change expert, international keynote speaker, and bestselling author of Cascades: How to Create a Movement that Drives Transformational Change. His previous effort, Mapping Innovation, was selected as one of the best business books of 2017. You can learn more about Greg on his website, and follow him on Twitter @DigitalTonto

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2 Responses leave one →
  1. August 19, 2022

    “We need to come to terms with what an incredible disappointment the digital revolution has been. It left the average American poorer, sicker and less happy than a generation ago.”

    But is that the fault of the technology? Or is it down to those who have sought to exploit the technology, not for the intellectual challenge, not for extending the boundaries of the human experience, but solely for the purposes of personal enrichment and shareholder value?

    (The two are not mutually exclusive, of course.)

  2. August 19, 2022

    You’re absolutely right. It is not the fault of the technology. It’s our fault and we need to do better. Fortunately, we’re being given another chance.

    – Greg

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