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IV

PROCEEDINGS



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Page 99 IV PROCEEDINGS

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Page 100

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Page 101 Welcome Charles Wessner National Research Council Welcoming the participants, Dr. Wessner noted that the meeting is being held under the auspices of the Board on Science, Technology, and Economic Policy (STEP), whose chair is Dale Jorgenson of Harvard University and whose Vice-Chair is William Spencer of SEMATECH. The STEP Board has a broad program of work underway, addressing issues at the intersection of science, technology, trade, and economic policy. 1 The STEP Board's current portfolio of projects includes work on work force needs in information technology, telecommunications innovation and regulation, and medical innovation. Focusing on the impact of new technologies on the U.S. economy, STEP conducted a major, multi-sector study of the United States' economic resurgence during the 1990s, entitled U.S. Industry: Restructuring and Renewal.2 It also has a major study underway 1 The STEP Board has a long-standing interest in these topics. For example, in 1995 the Board hosted a major conference on Technology, Wages, and Employment with contributors from many countries, the results of which were integrated into the 1995 OECD ministerial deliberations. In 1995-1996, the Board led a major international cooperative study that resulted in the summary report National Research Council, Conflict and Cooperation in National Competition for High Technology Industries, Washington, D.C.: National Academy Press, 1996. 2 The project reviewed the performance of eleven key manufacturing and service industries, focusing on how they have integrated new technologies as a means of enhancing their current performance and competitive position. The study assessed changing practices in research and innovation, technology adoption, and current operations. An important feature of the analysis is that it illustrates how science and technology are applied in the marketplace, how workers fare as jobs require greater knowledge, and how U.S. firms have responded to their chief competitors in Europe and Asia. This study produced two companion National Research Council volumes: U.S. Industry in 2000: Studies in Competitive Performance, and Securing America's Industrial Strength, both Washington, D.C.: National Academy Press, 1999.

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Page 102on Intellectual Property Rights in a Knowledge-Based Economy, which is assessing the impact of IPR policies on performance and communication of academic research, mobility of highly trained personnel, and competition and industry structure. This project was launched with a conference in February 2000 entitled “Intellectual Property Rights: How Far Should They Be Extended?” Today's meeting is the second in a series organized at the request of the National Institute of Standards and Technology (NIST) to fulfill a Senate mandate to examine the operations of the Advanced Technology Program (ATP). As a major government-industry program, the review of the ATP falls under the STEP Board's ongoing analysis of Government-Industry Partnerships for the Development of New Technologies, led by Gordon Moore, Chairman Emeritus of Intel. To review this sometimes-controversial program, the Board has invited an exceptional group of economists and entrepreneurs, as well as the federal officials responsible for the program, to discuss and assess the Advanced Technology Program. Dr. Wessner offered a warm welcome to Alan Balutis, the new Director of ATP, and Cita Furlani, Acting Deputy Director, and expressed special recognition to Rosalie Ruegg, the Director of the Office of Assessment for the ATP, now retiring from federal service after a distinguished career. The goal of the day's meeting was to take a careful look at the operations of the program, current trends and issues, and in particular, the well-developed assessment program of the ATP, Dr. Wessner said. To open the proceedings, he introduced Clark McFadden, a partner in the Washington law firm, Dewey Ballantine, who has been closely involved with many leading U.S. partnership programs. Because of his exceptional expertise, Mr. McFadden was named to the Steering Committee assembled by the STEP Board for the entire series of reviews of government-industry partnerships for technology development, including this meeting on the ATP.

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Page 103 Introduction to the Symposium Clark McFadden Dewey Ballantine On behalf of Gordon Moore and the rest of the Steering Committee, Mr. McFadden welcomed the group. The STEP Board has chartered the Steering Committee to oversee a series of reviews of Government-Industry Partnerships for the Development of New Technologies, a program begun in 1998. Since then the Committee has reviewed several partnership programs in some depth, including generic partnerships such as the Small Business Innovation Research (SBIR) program. One of the main topics of discussion nationally during this time has been the ATP. The ATP is unique among government research and technology programs in several respects: It goes beyond basic research (the traditional government focus), supporting industrial research in “enabling” technologies and encouraging commercialization of those technologies. It is therefore on the leading edge of government-industry relationships. It has been intensively studied and assessed. The core competence of the National Institute of Standards and Technology, ATP's parent, is measurement, and the agency has assiduously assessed the outcomes of the program. 3 The U.S. General Accounting Office (GAO) and congressional committees have frequently shone their own spotlights on the program. The Steering Committee, for its part, has profited from this extensive eco- 3 This volume includes abridged versions of some of the best recent work on this program. For a detailed description, see the Introduction.

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Page 104nomic analysis in its review of the ATP. The goal today is to bring varied points of view to bear on the program's effectiveness, efficiency, and rationale. These reviews will help the Steering Committee develop better ways to balance the risks, returns, and opportunity costs of other government-industry collaborations. Finally, the program is uniquely controversial. Although it began with significant bipartisan support, in the mid-nineties it became more closely associated with the Clinton administration. As a result, it was subject to intense scrutiny. One offshoot of this controversy is that the ATP has developed an exceptional assessment program, which we will hear more about later. Despite the frequent discussion of the program, an overview of the program's objectives and operations as well as the views of awardees and venture capitalists of its impact has never been undertaken. To provide an overview of the program's goals and operations, the Steering Committee produced an initial report on the ATP, copies of which are available at the meeting. 4 The focus of today's meeting, he said, is assessment. Outlining the day's agenda, Mr. McFadden reviewed the five panels that will review and discuss aspects of the program. Panel I will review the ATP Objective: Addressing the Financing Gap for Enabling Technologies. Moderated by Charlie Trimble of Trimble Navigation, who is also a member of the Steering Committee, this panel will offer the viewpoints of a venture capitalist, the founder of a high-technology start-up company, and a representative of a major high-technology corporation. Panel II will review the ATP's Assessment Program. Moderated by David Goldston, Legislative Director for Rep. Sherwood Boehlert (R-NY) this panel includes a summary by Rosalie Ruegg of the work of the assessment office and a critical assessment by two distinguished panelists. Panel III, moderated by David Finifter, College of William & Mary, will address some of the recent work on Stimulating R&D Investment. Panel IV takes up a major study on Assessing Progress: Case Study Clusters, moderated by David Austin of Resources for the Future. Panel V, moderated by Charles Wessner of the National Research Council, assesses the ATP Assessment Program and has the dual objectives of (a) reviewing the ATP's assessment program and suggesting improvements and (b) more generally reviewing the orientation of the ATP program itself and suggesting possible improvements. 4 National Research Council, The Advanced Technology Program: Challenges and Opportunities, Charles W. Wessner, editor, Washington, D.C.: National Academy Press, 1999.