Innovation Policy and National Security

Since WWII, the United States has created the most formidable innovation engine the world has ever seen and, although difficult to quantify, its benefits for the commercial economy have been enormous. America’s rise as the world’s high-tech hegemon is not a free market story, nor is it an industrial policy tale. Rather, it is the product of a national security state (NSS) that has pursued technological supremacy as a strategic imperative essential to sustaining U.S. power - increasingly by directly promoting commercial innovation in order to ensure collaboration from its most advanced suppliers. This NSS creation, however, is now threatened by financialisation of the U.S. economy, manifested in the growing disconnect between innovation and production and dwindling private investment in productive assets. To this extent, the main threat to U.S. preeminence would appear to come not from a rising power such as China, but from within. This lecture will explore the effects of the U.S. national security state and the U.S. innovation policy in the global scenario, and the impact of Trump’s new policies regarding high tech hegemony, international trade and the free flow of data.