ITIF re-stating what they have been saying for a long time.
!ping DEV-ECON
It’s a long ass research summary, but here are the policy prescription, which IMO are spot on:
> What To Do?
> It is beyond the scope of this report to lay out a full agenda to ensure that the United States, and for that matter its Western allies, does not lose its techno-economic lead to China. ITIF has laid out such a detailed agenda, including trade measures to protect U.S. and allied markets from unfair Chinese competition, in various reports. However, this report does lay out five key proposals:
> 1. Triple the Research and Experimentation Tax Credit. The Chinese R&D credit is already likely at least three times more generous than America’s, its R&D labor costs are less than half, and its R&D personnel costs are likely at least half of costs in the United States. One of the simplest and easy-to-administer steps Congress could take would be to triple the R&D tax credit for the Alternative Simplified Credit from 14 percent to 42 percent and allow expenditures on global standards setting to qualify.
> 2. Establish five national industrial research institutes focused on key, dual-use industries and technologies, modeled after Tawain’s Industrial Technology Research Institute, an industry-government advanced technology lab focused largely on IT technologies, with a long track record of working on technologies in what is referred to as the “middle Technology Readiness Levels” beyond what universities work on and earlier than most companies work on.
> 3. Establish a “Competitiveness Advanced Research Projects Agency (ARPA–C)” to co-invest with industry on research and application of key technologies needed for dual-use national security leadership in the commercial sector. Funded by year five with at least $20 billion per year, such an entity could be administered by NIST.
> 4. Establish a national industrial development bank to provide low-interest patient capital for new domestic manufacturing investment.
> 5. Institute a seven-year, 25 percent investment tax credit for all new machinery and capital equipment. America is “capital equipment lite”; China is not.
2 Comments
ITIF re-stating what they have been saying for a long time.
!ping DEV-ECON
It’s a long ass research summary, but here are the policy prescription, which IMO are spot on:
> What To Do?
> It is beyond the scope of this report to lay out a full agenda to ensure that the United States, and for that matter its Western allies, does not lose its techno-economic lead to China. ITIF has laid out such a detailed agenda, including trade measures to protect U.S. and allied markets from unfair Chinese competition, in various reports. However, this report does lay out five key proposals:
> 1. Triple the Research and Experimentation Tax Credit. The Chinese R&D credit is already likely at least three times more generous than America’s, its R&D labor costs are less than half, and its R&D personnel costs are likely at least half of costs in the United States. One of the simplest and easy-to-administer steps Congress could take would be to triple the R&D tax credit for the Alternative Simplified Credit from 14 percent to 42 percent and allow expenditures on global standards setting to qualify.
> 2. Establish five national industrial research institutes focused on key, dual-use industries and technologies, modeled after Tawain’s Industrial Technology Research Institute, an industry-government advanced technology lab focused largely on IT technologies, with a long track record of working on technologies in what is referred to as the “middle Technology Readiness Levels” beyond what universities work on and earlier than most companies work on.
> 3. Establish a “Competitiveness Advanced Research Projects Agency (ARPA–C)” to co-invest with industry on research and application of key technologies needed for dual-use national security leadership in the commercial sector. Funded by year five with at least $20 billion per year, such an entity could be administered by NIST.
> 4. Establish a national industrial development bank to provide low-interest patient capital for new domestic manufacturing investment.
> 5. Institute a seven-year, 25 percent investment tax credit for all new machinery and capital equipment. America is “capital equipment lite”; China is not.
Good, it’ll keep us on our toes.