Rebecca Bagley, President and CEO of Nortech and Business Forward participant, suggests that the sequester would seriously stunt innovation and tech global competitiveness. Read her blog, which initially appeared in Forbes, below:
It is hard to hear a newscast these days without some mention of the impending fiscal cliff. By the end of the year, we could be facing a ‘perfect storm’ of tax cuts, tax breaks and spending cuts that will have a significant impact on the U.S. economic recovery, if it is not handled appropriately. Over 1,000 government programs, including the defense budget and Medicare, are in line for deep, automatic cuts that begin to bite in January. According to Science Magazine, specific science and technology-based programs in jeopardy include, National Institutes of Health, National Science Foundation, U.S. Department of Energy, NASA, and Environmental Protection Agency, to name a few.
But rather than just looking at tax and spending cuts, why not reimagine the federal government’s role in funding? Why not use this opportunity to transition from our 1950’s approach to government funding and move it into the 21st century?
The public sector has had a long and storied history of using federal funding to spur research, technology development and commercialization. And, it is important that the federal government’s commitment to technology and innovation continues even in the midst of a looming fiscal crisis.
Why? The job losses from the fiscal cliff would be devastating by themselves but they would also set America further behind other nations in the race towards scientific and technological leadership. Technology and innovation are the building blocks of a globally competitive 21st century economy. Now is not the time to cut investments in this area. Rather, let’s look at streamlining programs, creating flexibility and empowering regions and states to compete for funding strategies that could spur job creation and long-term economic stability in the United States.
According to the Information Technology & Innovation Foundation, “reducing the budget deficit is important, but it should not and does not have to come at the expense of growth-inducing investments in areas like federal support for R&D.”
From where I sit in the technology-based economic development community, federal support for regional innovation programs is also vital for our economic recovery. Innovation-focused pools of capital need to be available at the federal level for regions to leverage existing resources, spur collaboration, and support job creation in high growth industries. We are seeing positive results in terms of job creation and economic impact from federal regional innovation programs, like the Jobs and Innovation Accelerator Challenge and i6, which have been awarded to public-private collaborations across the United States, including my home state of Ohio.
Perhaps what made these programs unique is that multiple federal agencies worked together to pool their funding, develop the program concepts, and create one application – all of which helped to streamline the entire process. Bringing together siloed federal programs, leveraging collaboration and promoting more coordinated funding opportunities that offer greater access, efficiency and customer service, make the best use of federal resources and funding for maximum impact. These are the kinds of approaches that congress should embrace to rationalize the funding.
Certainly, spending cuts are necessary in order to operate and maintain a fiscally responsible government. So, it will be important for Congress to think strategically about how to efficiently make reductions. But Congress needs to act sooner, rather than later. Announcing the adoption of a plan to fix the debt would help boost economic growth and spur job creation by reducing uncertainty about our economic future and renewing confidence in our political system.
While it’s true a balanced budget will require tough choices on spending and taxes, we need to ‘stay the course’ with investments in innovation, the engine of the economy. Congress needs to make every attempt to minimize cuts in the areas of science and technology, advanced energy, and manufacturing to ensure long-term economic prosperity. And if reductions are necessary, Congress must take a cautious and strategic approach to diminish the impact these changes may have on the growth of our innovation economy. Let’s move into a 21st century model that breaks down the silos and leverages private, state and local investment towards common goals of job creation and economic stability.