Losing Our Technology Advantage

Darrell M. West
Darrell West
Darrell M. West Senior Fellow - Center for Technology Innovation, Douglas Dillon Chair in Governmental Studies

February 17, 2009

Once on the cutting edge of technological innovation and access, U.S. high-tech now lags behind. In 2001, America ranked fourth in broadband access among industrialized nations. Now the country has dropped to 15th place. Thirty-five percent of Danes have access to high-speed broadband; only 22 percent of Americans do.

In countries such as Singapore and Malaysia, smart cards allow residents to complete a wide range of online transactions. These cards have holograms that prevent fraud, which has allowed agencies to place hundreds of services for citizens and businesses online.

Taxi drivers in Japan have intelligent transportation systems that allow them to spot traffic delays and find open parking spaces. Rather than circling the block and contributing to vehicular congestion, high-tech gadgets help drivers find the most convenient routes and available parking.

Use of health IT in other countries has outpaced that of the United States. Fifty-nine percent of the more than 30,000 health providers in the U.K. and 80 percent of the 9,000 doctors in New Zealand rely on electronic records, compared with just 17 percent of the 650,000 physicians in the United States. Not surprisingly, health care costs more to administer here than in countries with advanced information systems.

The Brookings Institution’s recent analysis of national government websites around the world found that the United States compares unfavorably to countries such as South Korea and Taiwan in technology utilization. Sites in these Asian countries offer a large number of electronic services, personalized content, media-rich applications, and easy access through PDA or handheld devices. Combined with their high-speed broadband infrastructure, the result is that processing times are faster, download speeds are quicker, and citizens in these countries take less time to perform necessary tasks.

There are several reasons why technology innovation in the United States no longer is prospering. Public-sector innovation is limited by the fact that state and local governments are divided into competing agencies. Fragmented and decentralized offices make it difficult for bureaucrats to work together to promote new ideas.

What’s more, growing budget deficits hinder national, state and local policy-makers from investing the funds required for advanced technology. At a time when health care, education and social services require larger chunks from public coffers, it is easy to starve technology investments. Yet, technology can make agencies perform more productively and efficiently.

The erosion of high-tech leadership has serious consequences for commerce, politics and entertainment. The slow speed on America’s information superhighways means many Americans are not able to take full advantage of advanced media applications such as the downloading of film and video for entertainment.

At the same time, government agencies are not able to guarantee confidentiality of medical records, employment data or official transactions. Schools are not able to take advantage of online instructional material requiring fast download speeds. And businesses do not have the infrastructure required to develop new jobs.

Advanced high-tech infrastructure is vital for our future. Productivity gains are at the core of any vision of reinventing government or stimulating the private sector. With extensive public cynicism, the only action with any hope of restoring citizens’ confidence is stronger public-sector performance.

Striving to stay competitive, the United States must invest more in its technology infrastructure. This includes tax credits for private-sector research and development, greater support for higher education, and adult training programs that help workers transition to a 21st century economy.

After World War II, our national government saw the building of highways, bridges and dams as vital to national security and economic development. We invested money in infrastructure to help defend ourselves and boost our economy. The results were spectacularly successful as measured by growth in post-war job creation, income levels and gross domestic product.

Now we need the same sense of urgency. Government officials must understand that our high-tech infrastructure should be a national priority and that an infusion of new resources will yield dividends down the road. It is time to take competition seriously.