May 8, 2008

Protecting Intellectual Property

The House today passed H.R. 4279, improving the protection of intellectual property rights, by a vote of 410-11. From the NAM's Key Vote letter:

As a founding member of the Coalition Against Counterfeiting and Piracy, the NAM has worked closely with Congress, policymakers and stakeholders in all sectors affected by IP theft to confront this serious challenge. NAM member companies believe strongly that by improving the coordination of federal government IP enforcement resources, as well as expanding authorities and improving enforcement practices at the international, federal, state and local levels, the PRO-IP Act will strengthen our manufacturing economy.

Posted by Carter Wood at 1:30 PM | Click here to comment | Send to a Friend

April 17, 2008

Senator Hatch at the NAM on R&D Today

The National Association of Manufacturers will host Sen. Orrin Hatch (R-UT) today at noon as the Senator makes the case for U.S. competitiveness and the innovation-based economy, emphasizing the need for action on the R&D tax credit. Hatch is a sponsor of the S. 2209, to strengthen and extend the tax credit for research and development investment.

The R&D tax credit expired again at the end of 2007 -- for the 13th time, it expired -- and companies are beginning to report the negative consequences in their first quarter earning statements. Meanwhile, countries like New Zealand are moving ahead with their own, even more generous investment incentives.

So there's a sense of urgency, or should be. Last week 85 members of House signed a letter urging leadership to move House R&D incentive legislation. (A copy of the letter is here.) For more, go to the R&D Credit Coalition's website.

And welcome, Senator Hatch.

Posted by Carter Wood at 8:47 AM | Click here to comment | Send to a Friend

April 2, 2008

Calling for Better Health Care Through Technology

Good column from Ivan Seidenberg, Chairman and CEO of Verizon, at the Health Affairs Blog on the need to enact Health IT legislation.

At Verizon, health care benefits used to be just one more element in a package of benefits, but now it is a line item in our budget of $4 billion annually and growing. Over 900,000 employees, retirees, and their families depend on our company for health care. We have a commitment to support the health and well-being of our employees and their families, so we have to figure out how to maintain this responsibility as its share of our corporate budget continues to grow. The technology to do so exists today but must be implemented thoughtfully. The first thing we need to do is adopt interconnected and interoperable standards for health IT platforms so that electronic medical records can be shared seamlessly among health care providers, as required by the bipartisan Wired for Health Care Quality Act.

The legislation is S. 1693 and H.R. 3800, which the NAM is also working to support as a member of the Health IT Now! Coalition.

Posted by Jeri Gillespie at 2:45 PM | Click here to comment | Send to a Friend

April 1, 2008

H-1B Visa Application Day: Sorry, All Out!

From The Washington Times:

Technology firms across the nation are crossing their fingers today as the U.S. opens the annual visa application window for skilled workers. Last year, the annual cap of 65,000 was reached on the same day.

Despite industry's efforts to raise the issue with lawmakers and the public, this year's quota of H1-B visas is likely to disappear just as quickly.

"Without adequate access to these types of key employees, a lot of U.S. companies will be forced to cancel U.S. projects or move them offshore, like Bill Gates did," said Ian Macdonald of the law firm Littler Mendelson.

That's the big picture. Here, courtesy The Chicago Tribune, is the microcosm:

Madhura Godbole speaks four languages. Since receiving a second master's degree from Loyola University Chicago last summer, she has been developing software to produce blood thinners for heart patients.

But it's luck, more than her impressive résumé, that the Indian-born engineer needs this week, as she enters a fierce annual competition for a small number of visas given to highly skilled foreign workers.

Isn't Madhura Godbole precisely the kind of highly skilled and U.S.-trained employee that benefits the U.S. economy, not to mention American civil society?

P.S. Another personal account from Ilya Shapiro of the Cato Institute, which concludes: "America continues to maintain an incomprehensible and counter-productive immigration policy, damaging both pocketbooks and heartstrings from Silicon Valley to the Bay of Bengal. Unless Congress and the White House do something to fundamentally reshape immigration rules with respect to skilled workers — setting aside for the moment the gardeners and construction workers who get all the news coverage — things will only get worse."

Posted by Carter Wood at 8:52 AM | 7 comments; click here to read them or submit your own! | Send to a Friend

March 28, 2008

Getting Overtaken on R&D Incentives

Eighty-seven days have passed since the U.S. research and development tax credit expired, nearly an entire fiscal quarter.

And in the meantime, other countries are expanding their incentives for R&D. From Britain comes the news...

The chancellor announced that large companies carrying out new technology R&D would receive higher tax incentives from HMRC. Tax credit enhancements rise to 175 percent for large companies from 150 percent, which means an organisation spending £100,000 on R&D will see a tax saving of £7,500.

Posted by Carter Wood at 1:38 PM | Click here to comment | Send to a Friend

March 19, 2008

In Michigan, Support for R&D Tax Credit

A very good forum on the innovation (OK, the NAM helped sponsor the event) in Greenville, Mich., with U.S. Rep. Dave Camp talking about the R&D tax credit -- an issue he's passionate about. From The Daily News:

GREENVILLE - A large part of the region's economic future rests on United Solar Ovonic.

Meanwhile, the Auburn Hills-based company's future largely rests on its ability to conduct continual research and development of more advanced products.

Nancy Bacon, executive vice president of United Solar Ovonic's parent company, Energy Conversion Devices Inc. (ECD) in Rochester Hills, called research and development "the foundation of this company" Tuesday.

Hence the focus on the tax credit, which expired AGAIN last year. Rep. Camp and Rep. Sander Levin (D-MI) have introduced a bill, H.R. 2138, to make the credit permanent.

Good observation as well from Gordon Stauffer, founder, president and CEO of Northland Corp. in Greenville: "Lapsing this tax credit has been disruptive... Not knowing what to expect has been difficult to deal with. This is as important to Michigan as anywhere else."

Oh, and nice web presence from United Solar Ovanic.

Posted by Carter Wood at 3:05 PM | Click here to comment | Send to a Friend

March 18, 2008

Innovation, a Kansas City Focus

The Kauffman Foundation sponsored an important conference in Kansas City on Monday focusing on innovation and competitiveness. From The Kansas City Star:

Tops on the “impediments” list: a U.S. education system that’s not turning out appropriately qualified graduates for the workplace, the panel said.

“Education and work worlds too often are spinning in separate orbits,” said Emily DeRocco, president of the Manufacturing Institute. “As the boomers line up at the exit doors in our manufacturing plants, we find almost no young workers ready to replace them.”

She said government incentives, educators and parents need to redirect attention to the value of technology-based education, keyed to the needs of today’s workplace.

The forum was the first of three the Department of Commerce is scheduling to follow-up on an advisory panel it commissioned on "Measuring Innovation in the 21st Century Economy." The Kauffman Foundation's CEO, Carl Schramm, chaired the panel.

We'll link to Secretary Gutierrez's speech when it becomes available.

Posted by Carter Wood at 11:45 AM | Click here to comment | Send to a Friend

March 12, 2008

Bill Gates: For Innovation, Education and Visas

Microsoft's Bill Gates testified today before the House Science and Technology Committee, making the case for education, tax and immigration policies to encourage an innovative, dynamic economy. To which we can only say: Yes.

Forbes' technology columnist Brian Wingfield does a nice job of capturing the arguments and the atmosphere:

Gates wants to see more funding for a National Science Foundation program for math, science and engineering graduates students, and he suggested that at the high school level, math and science teachers should be paid more. He's urging Congress to support state programs that measure students' learning abilities.

"Ultimately, we need to identify a smaller set of clear, high and common state standards that reflect what young people truly need to know to be successful in the 21st century...," he said in his prepared remarks.

And...

Gates also argues that the U.S. should raise the cap on so-called H-1B visas for skilled foreign nationals so that the U.S. can retain the high-tech workers it trains at its universities. "The fact that their smartest people want to come here has been a huge advantage for us, and in a sense we're throwing that away," Gates said.

In addition, he urged lawmakers to raise the current cap on employment-based visas, or "green cards," and he called on Congress to renew the now-expired research and development tax credit..

Posted by Carter Wood at 7:55 PM | Click here to comment | Send to a Friend

March 11, 2008

H-1B Visas, Creating More Jobs for Americans

From PC World:

For every H-1B position requested, tech companies listed on the S&P 500 stock index increased their employment by five workers in an analysis of 2002 to 2005, according to astudyby the National Foundation for American Policy (NFAP).

For tech firms with fewer than 5,000 employees, each H-1B request corresponded with an average increase of 7.5 workers, the group said.

Few topics on the blog elicit more heated reaction than support for increasing the H-1B visa cap. (It's generally well-spoken reaction, we add.) Employees argue that the visa program is just the way for employers to avoid hiring capable Americans for the jobs and for them to keep their labor costs down.

That may well be true in individual cases. But we've talked to enough manufacturers to know that they'd gladly hire and pay well a qualified, available American first. They'd gladly hire and pay ANYBODY.

Unfortunately, given the growth of their operations -- and the U.S. high-tech economy more broadly -- the demand for skilled employees is outstripping the supply. There just aren't enough of the right people with the right skills available, period. More from the PC World article:

NFAP looked at the number of job openings at tech firms and defense contractors and found 140,000 job openings at S&P 500 firms in January, including more than 4,000 job openings at Microsoft, more than 1,600 openings at both IBM and CSC, and more than 1,500 openings at Cisco Systems. After Microsoft, the company with the most job openings, were defense contractors Northrup Grumman and Lockheed Martin, each with more than 3,900 job openings, according to a second study by NFAP. More from PC World:

You exhaust the 65,000 cap on H1-B visas pretty quickly given this kind of demand.

These shortages of skilled employees crimp a company's ability to meet the demands of the marketplace. So get the right people by hiring domestically as well through the H1-B visa program, and you can expand your business and spur economic growth. You create more jobs, more good jobs, for everybody.

The larger point is that the United States now competes in a global economy, with its competive advantage resting on innovation -- new products, new processes. Integral to this economy is the global competition for the talented individuals, those who can keep driving innovation, and in great demand are graduates of U.S. universities. Better they contribute to the American economy -- and as aspiring, talented individuals, to American society -- than make our competitors even more successful.

NFAP Policy Brief: H1-B Visas and Job Creation.

NFAP Policy Brief: Talent Search: Job Openings and the Need for Skilled Labor in the U.S. Economy.

Workforce Management: Microsoft’s Canadian Move a Swipe at Stiff U.S. Visa Policies

CNET News: Study: H-1Bs prompt more, not fewer, American hires

Posted by Carter Wood at 9:51 AM | 4 comments; click here to read them or submit your own! | Send to a Friend

The Global Race for R&D

How does the United States, a world class leader in innovation, retain its competitive position in a global race for R&D investment dollars? Not by allowing the R&D credit, a proven incentive for spurring additional R&D, to expire 13 times since the credit was created more than 25 years ago. What kind of message about our commitment to innovation does the United States send the world with an on-again, off-again R&D incentive?

The credit expired more than two months ago. Policy makers need to turn the page and end the embarrassing history of repeated lapses of the credit. The R&D credit is a proven incentive for innovation. What are they waiting for?

Posted by Monica McGuire at 7:45 AM | Click here to comment | Send to a Friend

March 8, 2008

Bill Gates on Competitiveness, Innovation

A committee hearing next week we're looking forward to:

The House Science and Technology Committee
Competitiveness and Innovation on the Committee’s 50th Anniversary with Bill Gates, Chairman of Microsoft [Scheduled]
March 12th, 10 a.m., 2318 Rayburn House Office Building

The committee's creation coincided with the start of the space race a half century ago, i.e., the launch of the U.S. satellite, the Explorer.

UPDATE (1:45 p.m.) What? He's slipped to being only the world's second wealthiest man? Well, then, never mind.

Posted by Carter Wood at 8:51 AM | Click here to comment | Send to a Friend

March 7, 2008

Once an Apprentice, now a Political Technomage

Great to see Dave Kralik interviewed in today's Investor's Business Daily. Kralik, who once labored here at the NAM in pseudonymous obscurity as the Blogger's Apprentice, is now director of Internet strategy at American Solutions for Winning the Future, Newt Gingrich's forward-thinking outfit. From IBD:

Kralik: We realize at American Solutions that what we want to accomplish cannot be done without embracing the latest technology. That includes social networking and online learning and collaboration and mobile technologies.

We opened an office here in Silicon Valley to embed ourselves with the technology sector, to learn from the best.

That's part of my mission being here, to connect with the tech companies that made Silicon Valley the center of innovation.

IBD: But are you looking for best practices in technology or looking instead to hear what concerns the executives in Silicon Valley have?

Kralik: It's both. We want to play a strong advocacy role. We want to understand the issues that are important to Silicon Valley executives and employees.

For instance, it's utterly silly that we have to extend year after year the R&D tax credit and for some reason we can't make it permanent. Why can't we raise the level of H-1B visas (for foreign workers)? We want to be out here to advocate for those issues.

Nice write-up, Dave. Best of luck on the advocacy.

Posted by Carter Wood at 12:23 PM | 1 comment; click here to read it or submit your own! | Send to a Friend

March 6, 2008

Innovation och Manufacturing

I just returned from the Washington International Renewable Energy Conference – WIREC (doesn’t that just roll off the tongue) today having seen a broad collection of manufacturers and energy industry leaders discuss and demonstrate new technologies in the field of renewables and conservation. President Bush stopped by yesterday to address the conference and summed up the driving force behind these innovation.

Our private sector is investing a lot of money -- and I fully understand there needs to be consistent policy out of the U.S. government that has thus far provided incentives to invest. What the government doesn't need to do is send mixed signals. I understand private capital, understand how it flows. And so when people look at the United States to determine whether we're committed to new technologies that will change how we live, they not only need to look at the federal investment, but they've got to understand there's a lot of smart money heading into the private sector to help develop these new technologies.

We’re always happy for recognition -- and from the President, especially -- that it’s the private sector, not government regulation and mandates, that's really driving innovation. The United States is the leader in global R&D investment, and it's manufacturers accounting for 70 percent of all business spending on R&D. The President also recognized a pretty amazing demonstration at the conference that Volvo showcased. Volvo Group is featuring seven renewable fuel trucks and one hybrid electric vehicle (HEV) on the Trade Show exposition floor here. The trucks each run on seven different types of renewable fuel . As President Bush noted: “Five years ago those trucks would not have been available for people at this exhibit to look at.” Many of these trucks are made in Dublin, Virginia at Volvo's largest heavy truck plant in the world. Pretty neat.

Posted by Keith Smith at 3:32 PM | Click here to comment | Send to a Friend

March 4, 2008

Good Ideas for Manufacturing (Sorta)

The EPI’s Susan Helper writes in today’s Washington Post:

One-tenth of all U.S. jobs are in the manufacturing sector -- good jobs that pay 20 percent more than the national average. Manufacturing accounts for 12 percent of gross domestic product and over half of our national spending on research and development.

Because even the most modern economies cannot thrive without making things.

Good ideas that will help presidential candidates win in Ohio today can also help America win in the global economy. Let's remember that, long after the votes are counted.

What kind of good ideas? Helper recommends that we “start with more investment in education, training, and research and development.” In that, the NAM agrees, but it's not enough. Addressing the skills gap, improving our national infrastructure and promoting R&D are a start, but we also need to address the serious challenges faced by manufacturers in the United States -- things like soaring energy costs, the high costs of civil litigation, and a corporate tax structure that discourages investment.

Today’s manufacturers need pro-growth policies put in place to help them compete in this global market place. Candidates who advocate one set of policies, however credible, without addressing the costs of doing business aren't doing anyone a favor.

Posted by Keith Smith at 5:21 PM | Click here to comment | Send to a Friend

February 29, 2008

R&D Tax Credit: If Not Now, When?

Today—February 29—means that 59 days have passed since the R&D tax credit expired at the end of last year. How long will manufacturers have to wait for Congress act to renew and strengthen this jobs credit? We’ve only heard promises from lawmakers to restore “business extenders,” yet seen no action to date to fulfill that promise. Meanwhile, most of our major trading partners offer more attractive—and permanent— R&D incentives. Right now, with no credit in place, the United States is clearly at the bottom of the pile.

Allowing this tax provision to expire 13 times, which is exactly what Congress has done since 1981, weakens the credit’s incentive value to boost private research and development spending, and ranks among the worst of tax follies by a powerhouse country like the United States. If companies cannot rely on the credit for the duration of an R&D project—for manufacturers typically 5-10 years—companies performing R&D are going to be enticed to look at the 20 OECD countries offering more generous R&D tax incentives.

We’ve got to ask ourselves, if not now, when will Congress seamlessly renew and strengthen the credit?

Posted by Monica McGuire at 9:25 AM | Click here to comment | Send to a Friend

February 27, 2008

Work Smart, Tax Smart -- The R&D Tax Credit

Lots of good articles on tax policy in the February/March issue of The Ripon Forum, the magazine of the Ripon Society. Featured is a piece by National Association of Manufacturers President John Engler on the R&D tax credit, "Incentive and Inventive: Smart Tax Policy Needed to Promote U.S. Manufacturing."

It’s a comment many of us heard in our early years on the job, delivered by a demanding boss or exasperated coworker: “Work smarter, not harder!”

Manufacturers in the United States take those words to heart. They have to.

Although no strangers to hard work, America’s manufacturers know that their competitive advantage in the hard-fought global marketplace lies in the ability to work smarter. Other countries will boast lower costs of labor or raw materials, so it’s skilled and creative people who ensure America’s competitive edge – the edge that builds on research, development, investment and innovation.

For many years, a bipartisan consensus in Congress has helped maintain that American edge. Republicans and Democrats both have supported smart policies that encouraged the R&D and innovation that lead to new products, technologies and manufacturing processes. Yet year after year, Congress still does a dumb thing: It allows the federal research and development tax credit to expire, throwing U.S.-based business into a world of uncertainty and frustration.

The NAM has a recent ManuFacts summary of the R&D tax credit available here.

Posted by Carter Wood at 7:56 AM | Click here to comment | Send to a Friend

February 22, 2008

Patents, Innovation and U.S. Leadership

From VOA:

The United States has retained its position as the world's most inventive country. But, the World Intellectual Property Organization says countries in northeast Asia are catching up. Last year, WIPO says 156,000 patent applications, a record number, were filed, representing a 4.7 percent increase over the previous year. Lisa Schlein reports for VOA from WIPO headquarters in Geneva.

The says the growth in patent filings by several countries in northeast Asia confirms shifting patterns of innovation around the world. It notes nearly 26 percent of all international patent applications last year came from Japan, South Korea and China.

The WIPO news release is here, and its patents section is here.

Knee-jerk reaction to news: Improve education in math and science, discourage the bread and circuses, and expand H1-B visas.

Meanwhile, the Small Business and Entrepreneurship Council has a new report out, "Patent Reform: Protecting IP, Enabling Innovation, & Bolstering Entrepreneurship." New York Times summary:

Raymond Keating, the group's chief economist, said the patent system needed to be restructured to bolster patent quality while reducing costs. Other reforms, he said, should include patent litigation, international harmonization and a shift to a first-inventor-to-file approach, as opposed to first-to-invent.

Posted by Carter Wood at 10:41 AM | 1 comment; click here to read it or submit your own! | Send to a Friend

February 21, 2008

An Israeli Perspective on Patent Reform

Bernard G. Frieder, a British technology consultant now working with Israeli firms, writing in The Jerusalem Post, expresses alarm at the patent legislation being proposed in the U.S. Senate.

Because inventors, research organizations and startup ventures around the world rely on US patents to protect the output of their labor, changing the US patent system has global repercussions...[snip]

Over the past 20 years, a significant proportion of the Israeli economy - and export growth - has been based on our patent-centric technology sector. From essentially a handful of companies, Israel has developed a world-renowned start-up culture and multi-billion venture capital investment engine. In fact, Israel is second only to California's Silicon Valley as a driver of global innovation.

He has many, many specific objections:

THE PROPOSED changes would greatly increase the costs of securing a basic US patent and expand filing requirements and processing time, thereby reducing a patent's term of protection.

Also, a US patent would no longer be a secure asset since its validity could be challenged during the course of its effective life. There would be no closure. The potential for costly litigation would skyrocket and patent holders would be forced to "lawyer up" - to defend themselves against opportunistic plaintiffs.

Which is a sure way to discourage investment in innovation.

Posted by Carter Wood at 8:32 AM | Click here to comment | Send to a Friend

February 12, 2008

To the Labor Unions, Applause on Patent Reform

Seth Borden of the management law firm Kreitzman, Mortensen & Borden alerts us to a great letter a group of labor unions sent to the U.S. Senate last week stressing their opposition to S. 1145, the Patent Reform Act of 2007. An excerpt:

The American economy relies on the ingenuity and imagination of inventors coupled with the hard work and dedication of our workers, to drive our economy and the creation of jobs. The U.S. patent system, the strongest in the world, has protected the work of the inventor, solidified our leadership in innovation and allowed the American economy to produce the jobs and products of the future. S. 1145 would significantly weaken that protection making it far easier for our competitors to gain access to this knowledge and steal it for their own individual gain.

A very good letter. It’s remarkable and encouraging to see how an issue that is the key to our economic power – intellectual property – can unite disparate groups such as labor and management. The NAM is working with the Teamsters on counterfeiting and piracy, too. The fact that they’ve jumped into the fray on this is proof positive that not only is IP the engine of our economy and must be preserved, but that this particular bill is so harmful that the unions will break ranks with their usual political allies.

More at the Anticipate This! patent and law blog.

Posted by Carter Wood at 3:24 PM | Click here to comment | Send to a Friend

January 15, 2008

Energy, Global Warming and Research: Get Real

Roy W. Spencer, principal research scientist at the University of Alabama in Huntsville, rebuts the alarmists and dreamers who prefer feel-good solutions and wishful thinking to the arduous and expensive research needed to address global warming. From "Reality Deniers":

I am astounded by the naiveté of those folks who seem to think there is some magic, non-polluting energy source out there that “Big Oil” has been hiding from us until all of the petroleum runs out. As these reality deniers continue to drive cars and fly in airplanes, they deny the fact that mankind’s dependence on oil is not out of choice, but necessity.

It makes me cringe when I see bloggers and pundits say things like, “What’s the downside of reducing greenhouse-gas emissions? Even if we’re wrong about man-made global warming, we’ll end up with better energy technologies and cleaner air. And if we’re right, we’ll save the planet!”

The only problem is, no matter how serious you think global warming will be, our current renewable-energy technologies and conservation will make virtually no difference to future global temperatures.

Spencer also has smart comments about education, entertainment and the need for nuclear energy.

Along those lines, we note that the presidential candidates all seem to have a line about the need to increase energy R&D. It's as if that's a brand new idea, and doggone it, why haven't Congress and the private sector thought of that before.

Posted by Carter Wood at 9:25 AM | 2 comments; click here to read them or submit your own! | Send to a Friend

January 9, 2008

D.C. Council: Get Your Priorities Straight

The D.C. City Council voted 7-6 vote on Tuesday to license pharmaceutical company sales representatives, making it the first city in the country to regulate drug sales reps.

So a city with 181 killings in 2007 -- an increase of 7 percent over the previous year -- where the government financial scandals come fast and furious, is going to establish and operate a new regulatory regime. Forgive us if we lack confidence in D.C. ability's to carry out this oversight.

[Opponents] worried about the precedent such regulation would set for other sales positions, as well as the effects of promising to police an industry better than the federal government can.

"Over-regulation, misguided regulation, bad regulation affects everybody," said Councilwoman Muriel Bowser, D- Ward 4, who voted against the bill. "I know it won't do what it claims to do."

Correct. More costs, redundant government and no obvious benefits. Lots of potential for shakedowns and corruption, though.

Another bit of silliness: The bill, called SafeRx, requires drug reps to have a bachelor's degree. Why not specify the course of study, too? No art history majors need apply.

UPDATE (1:10 p.m.) PhRMA comment, from Washington Post story:

"The bill was significantly revised, but it does absolutely nothing to benefit patients," Ken Johnson, senior vice president of Pharmaceutical Research and Manufacturers of America, said in a statement released after the vote. "It is still legislation looking for a reason to exist. The fact is the licensing of sales representatives is not needed."

Posted by Carter Wood at 8:29 AM | Click here to comment | Send to a Friend

January 6, 2008

Presidential Debate on Drugs

On the topic of pharmaceuticals, last night's New Hampshire debates saw a push-back against the anti-industry rhetoric. Instapundit has a good selection of links on both the Republican and Democratic debates. Jonathan Adler, a Thompson supporter, gives Mitt Romney an "attaboy" for rejecting the demogoguery, which, if translated into policy, cripples research and prevents cures.

ABC's Charlie Gibson was very good, asking serious questions and seeking information. How low have our standards fallen, that a moderator avoiding goofiness is worthy of note?

Granted, ABC's new platform for political coverage is Facebook, not usually thought of as a policy-heavy medium.

Posted by Carter Wood at 8:13 AM | Click here to comment | Send to a Friend

December 21, 2007

Congress Raised Taxes on Innovation

Bloomberg:

Dec. 21 (Bloomberg) -- Hewlett Packard Co., CA Inc. and thousands of other U.S. companies may see their taxes rise in 2008 because Congress adjourned without extending a tax credit for research.

Lawmakers including House Ways and Means Committee Chairman Charles Rangel and Senate Finance Committee Chairman Max Baucus said they will take up the credit, along with dozens of other expiring tax provisions, next year. Still, companies that would use the credit cannot assume it will be restored for the purposes of financial reporting.

``For R&D intensive companies, this is an immediate, $8 billion tax increase,'' said Monica McGuire, senior policy director for taxation at the National Association of Manufacturers, a Washington advocacy group.

How soon next year, gentlemen?

The NAM's statement on the failure to extend the R&D tax credit is here.

Posted by Carter Wood at 1:32 PM | Click here to comment | Send to a Friend

December 19, 2007

Innovation Nation or Short Attention Span?

At a just-completed news conference releasing a report on small- and medium-sized manufacturers, National Association of Manufacturers President John Engler noted the increasingly important role these companies have conducting research and development.

And Congress fails to extend or make permanent the R&D tax credit? Engler:

While there are promises on both sides of the political aisle that this will be addressed right away in the new year, it’s an embarrassment for the innovation nation like the United States to have our major tax credit, really the only federal policy we have that prefers innovation, expiring or being treated with benign neglect by Congress, or being treated like a political football.

Whatever the excuse, whatever the reason, the expiration of this tax is a sobering message about the importance of innovation, really, to the bottom line of the Congress of the United States.

Engler's issued a statement yesterday on the tax credit's expiration. You can read it here.

Posted by Carter Wood at 11:35 AM | Click here to comment | Send to a Friend

December 13, 2007

Starting Soon: Hearing on IPR, Copyrights

Thursday 12/13/2007 - 10:00 AM
2141 Rayburn House Office Building
Subcommittee on Courts, the Internet, and Intellectual Property
Hearing on H.R. 4279, the “Prioritizing Resources and Organization for Intellectual Property Act of 2007” BusinessWeek has a good preview story here.

Rick Cotton, general counsel for NBC Universal and chair of the coalition, said Wednesday the bill is "a declaration of war against the global counterfeiters and global pirates."

NBC Universal is 80 percent owned by General Electric Co. and 20 percent by Vivendi, the Paris-based entertainment company.

Cotton will argue in testimony Thursday before a House Judiciary subcommittee, chaired by Berman, that copyright-enforcement resources and penalties need to increase to counter technological advances that have made large-scale production of pirated and counterfeit goods easier.

James P. Hoffa, general president of the Teamsters union, is also scheduled to testify in favor of the bill.

Yay, Teamsters!

The NAM issued a news release praising the bill upon its introduction.

Posted by Carter Wood at 9:57 AM | Click here to comment | Send to a Friend

December 6, 2007

R&D Tax Credit: Haven't We Been Here Before?

It was a bright, cold day in December, and the R&D tax credit was striking thirteen.

From PC World:

More than 40 trade groups, many representing the IT industry, have renewed their calls for the U.S. Congress to extend a research and development tax credit that expires this month, saying the tax break protects U.S. jobs.

Groups including the Business Software Alliance, the Biotechnology Industry Association, the Information Technology Association of America, and the Information Technology Industry Council (ITI) said the tax credit is a critical piece of U.S. innovation. During a press conference on Wednesday and in a letter to congressional leaders dated Tuesday, the groups pressed Congress to extend the credit, which will expire for the 13th time since 1981 on Dec. 31.

"The credit for us is really a jobs issue," said Jay Timmons, senior vice president for policy at the National Association of Manufacturers. "The bottom line is, it's about keeping high-skilled, high-wage jobs in the United States."

The NAM's news release is here.

Posted by Carter Wood at 9:31 AM | Click here to comment | Send to a Friend

December 1, 2007

A Positive Contribution to the Environment: Trade

The National Association of Manufacturers has worked on this proposal for quite some time. Great to see it now announced. From U.S. Trade Representative Susan Schwab:

Washington, DC – U.S. Trade Representative Susan C. Schwab announced today that the United States and EU have submitted a ground-breaking proposal as part of the Doha Round negotiations to increase global trade in and use of environmental goods and services. The initiative would place priority action on technologies directly linked to addressing climate change and energy security.

"WTO Members have an unprecedented opportunity to address in a concrete and meaningful way the global environmental challenge of climate change,” said Ambassador Schwab. “By eliminating tariff and non-tariff barriers to environmental goods and services, particularly clean energy technologies, we can lower their costs and increase global access to and use of these important products.”

The proposal lays the foundation for an innovative new environmental goods and services agreement (EGSA) in the WTO and would include a commitment by all WTO Members to remove barriers to trade to a specific set of climate-friendly technologies.

White House Press Secretary Dana Perino highlighted the proposal in yesterday's news briefing.

UPDATE (1 p.m.) The AP story provides more context on this proposal as part of the Doha negotiations. One hopes they give the talks a good push forward.

Posted by Carter Wood at 12:42 PM | Click here to comment | Send to a Friend

November 28, 2007

Gatorade

Today's papers report that the inventor of Gatorade has passed away. Dr. Robert Cade invented the now-famous sports drink in 1965 to help football athletes at the University of Florida replace carbohydrates and electrolytes lost through sweat during training. Everyone is interested in the innovation process and the creation of this multi-billion industry is a good insight into how new products are born.

It doesn't always take a huge research budget to innovate. The need for Gatorade was identified when Gators football coach Dwayne Douglas asked Cade, "why don't football players wee-wee after a game?" Dr. Cade, who was a professor of internal medicine at UF, jumped on that question with some of his researchers and learaned that a football player can lose up to 18 pounds -- up to 95 percent of it water -- in a typical three-hour game.

With about $43 in supplies, Dr. Cade and his team developed a brew that replaced the water and minerals lost by players, but their first step on this road to innovation didn't meet with a lot of success. Dr. Cade said sometime ago in an interview that it tasted like toilet bowl cleaner. After adding some sweeteners, the coach tried it out on freshmen because he didn't want to hurt the varsity players.

Eventually the drink became a standard part of the Gators' playbook and caught the attention of others after the 1967 Orange Bowl, where UF defeated Georgia Tech. The GT coach remarked that they lost that game because "we didn't have Gatorade....that made the difference." After that, the sports drink was commercialized and has become a popular beverage around the world, a development that Dr. Cade never envisioned when he created his first concoction. Inventions can be like that: one good thing leads to another.

Our condolences to the Cade family on losing a man who is one of American's true innovators.

Posted by Bill Canis at 9:30 AM | Click here to comment | Send to a Friend

Water Treatment: Waste Not, Want Not

By dint of a prominent link at the Drudge Report, this story about converting sewage to drinking water got a lot of attention by bloggers. The "ick" factor, we're sure.

FOUNTAIN VALLEY, Calif. — It used to be so final: flush the toilet, and waste be gone.

But on Nov. 30, for millions of people here in Orange County, pulling the lever will be the start of a long, intense process to purify the sewage into drinking water — after a hard scrubbing with filters, screens, chemicals and ultraviolet light and the passage of time underground.

All the better for that manned mission to Mars.

In any case, we were reminded of a recent interview in The Financial Times with Jeffrey Immelt, chairman and CEO of General Electric. It's a very interesting interview heavy with a discussion of energy needs, but this answer from Immelt is relevant ot the world's rising demand for potable water.

FT: What other parts of the infrastructure business would you like to pick out as an example of a growth field?

JI: Water treatment is a big and expanding area for us. We get about $2.5bn a year in sales from this sector now. I'd be very disappointed if it is not $5bn-$10bn in the next 5-10 years. We've made a number of acquisitions in this field and would be interested to look at more, such as in membrane technology [for cleaning up water supplies through filtering or osmosis technologies]. We are setting up a new research centre in Singapore - where there is a lot of expertise in this field - to examine new applications in these disciplines. Water is just the kind of business that suits GE to be in. It's a global field with a lot of potential in the emerging economies. There's a great deal of commercial and government focus to improve countries' capability to provide a safer and more cost-effective water supply.

A large portion of GE's website is devoted to water treatment technologies.

Posted by Carter Wood at 9:05 AM | Click here to comment | Send to a Friend

November 25, 2007

Ireland, Canada and Tax Competitiveness

From the Sunday Irish Business Post:

An expansion of tax credits for research and development and a reduction in red tape for Irish companies are among the measures to be announced in the forthcoming budget.

The moves are designed to boost competitiveness and innovation for small and medium-sized companies. The package was agreed by senior government officials in the past few days and will now be presented to the cabinet for approval.

The Minister for Finance, Brian Cowen, is also set to index tax credits and the standard rat e bands, while pensions and social welfare payments will be increased.

Meanwhile, in Canada.

Finance Minister Jim Flaherty is considering bringing in measures to provide relief to Canada's manufacturing industry, which is feeling the effects of the high dollar.

Posted by Carter Wood at 5:50 PM | Click here to comment | Send to a Friend

November 15, 2007

NYC Preview of the Consumer Electronics Show

NAM's Peggy Ireland volunteered again this year to report back from her journeys into the land of innovation and consumer electronics, and we gladly took her up the offer. Last January Peggy -- a Capital area veteran of things computeresque -- spent four days in Las Vegas at the Consumer Electronics Show. There's so much to cover that this year she's decide to get a jump on January's 2008 international CES by attending this week's media preview in New York City.

Knowing how interested manufacturers and others are interested in gadgets, gizmos, breakthroughs and innovations, we'll let Peggy provide a full report:

With 140,000 attendees expected and over 2,700 exhibitors the Consumer Electronics Show (CES) is the largest tradeshow in North America. And I can tell you from experience there is so much to see it is almost overwhelming. With thoughts of preparing for what I am going to see this January and an ulterior motive of generating a fabulous holiday gift list for myself, I headed for the Official Press Preview of the International CES in New York on Tuesday.

Convergence has been a major theme in the IT world where I live and in the consumer electronics industry for some time now. Today was no exception as the Consumer Electronics Association’s (CEA) market research experts talked about a “360 degree solution” referring to the convergence of content, services and devices?

Can you imagine software that connects your cell phone to your home appliances, your security devices, your computer peripherals and other devices in your home? PUCC (Peer-to-Peer Universal Computing Consortium) is a non-profit organization composed of twenty-five member companies and Japanese universities, who has developed common overlay network technologies to seamlessly connect various devices and networks. I am told that consumers in Japan are already using this technology. Hmmm, perhaps, by the time I take my next trip to New York City, I will be able to call home to Washington, DC and have dinner ready for my return or at least a fresh cup of coffee.

There's lots more to review, so to read Peggy's complete report, please click here. Among the products and companies Peggy talks about are:

US Telematics’ Vivee, Voice Interactive Voice Enhanced Email

Voxred International LLC

Callpod

CyberLink

Fujitsu Computer Products of America, Inc.’s ScanSnap S300 Document Scanner

Vestalife Inc.’s Ladybug

Able Planet’s Sound Clarity wireless headsets

Twenty20's “VholdR” camcorder

RCA Small Wonder digital camcorder

Wildcharge Inc.

SentrySafe secure drive

Simplay Labs, LLC

Posted by Carter Wood at 8:13 AM | 1 comment; click here to read it or submit your own! | Send to a Friend

November 13, 2007

Indiana: Rewarding Research and Innovation

Catching up on Hoosierdom, we see that Indiana Gov. Mitch Daniels has announced the Dr. Philip E. Nelson Innovation Prize to recognize outstanding Indiana scientists for unique discoveries, research and inventions. The prize -- and a $5,000 award -- is named after the Purdue scientist who received the 2007 World Food Prize in October for his achievements in the field of food processing. Nelson advanced the aseptic process of storing fruits and vegetables to prevent post-harvest spoilage.

From the governor's news release:

Daniels said the Nelson Innovation Prize will recognize a Hoosier scientist whose work goes beyond pure scientific research and leads to the creation of products or processes that revolutionizes industry, inspires further scientific inquiry, and improves the quality of life. Recipients will be scientists with a unique combination of intellectual curiosity, scientific expertise, and entrepreneurial spirit.

Glad to see scientists and researchers receive such high-profile public honors, inspiring -- we hope -- future generations of innovators. At $5,000, the award is not enough to spark competition -- like the $10 million X prize for private spacecraft or 100-mpg vehicles -- but it certainly represents serious recognition...and appreciation.

Would sure like to see more honors of this kind.

Posted by Carter Wood at 11:40 AM | Click here to comment | Send to a Friend

October 16, 2007

Internet Taxation: The Arguments

Attempting to influence today's House vote, The Washington Post's editorial page endorsed a four-year extension of the federal moratorium on taxing Internet access. "The Web Grows Up -- Internet services shouldn't be a tax-free zone" is the title of the column, which is a fair-enough argument about the merits of a temporary versus permanent ban on Internet taxes. (To be specific, what's being debated is halting state and local taxes on accessing the Internet, not the taxation of services provided via the Internet.) Except the Post's view of issue is awfully limited, and in a familiar way, underestimating the appetites of those who tax.

A four-year extension is a more than fair deal for an industry whose claim to special tax treatment is tenuous at best. The Internet is not in danger of being stifled by a few extra dollars tacked on to subscribers' monthly bills. The latest justifications for treating Internet services differently from clothing, food or numerous other goods and services that states and localities choose to tax is to spur the build-out of broadband access and reduce the "digital divide," the gap between the rich and poor when it comes to Internet access.

But that's a bogus argument, the Post contends, since states that had taxation grandfathered in are not suffering comparatively in broadband penetration compared to non-tax states.

The Post's analysis of the economic impacts is too narrow, though, based on an assumption that only Internet companies need worry about a modest tax. But the NAM goes at the issue not (only) from the perspective of a trade association with many members who provide Internet access or manufacture Internet-related products. Internet access affects probably 99-plus percent of U.S. manufacturers in one form or another, and we're not talking about a "few extra dollars" hitting only home customers. Many corporations monitor worldwide inventories, for example, via the Internet; CAD schematics might be discussed in five engineering shops simultaneously; and we all know about virtual meetings.

One can be sure that tax writers would see lucrative new sources of revenue and a "few extra dollars" would soon becomes thousands, tens of thousands, millions of dollars -- multiplied many times across the entire economy.

You know what just crystallized our thinking on this issue? Examining our monthly phone bill, that page with the category, "Tax, Surcharges and Other Fees."

DC Universal Service Trust Fund -- $0.31
DC Public Rights-of-Way Use Fee -- $1.91
DC Gross Receips Tax Surcharge -- $0.73
DC E911/311 Fee -- $0.76
DC Federal Universal Service Fund Surcharge -- $0.45

We just bet that jurisdictions would find a way to turn a simple Internet access tax into a wondrous range of surtaxes, premiums and user fees.

Posted by Carter Wood at 5:46 PM | Click here to comment | Send to a Friend

House Extends Internet Tax Moratorium

From CQ's Midday Update:

Despite grumbling from lawmakers who want a permanent ban, the House voted overwhelmingly Tuesday to extend for four more years a moratorium on taxation of Internet access.

The bill (HR 3678) passed 405-2, The existing ban on Internet access taxes will expire Nov. 1 unless Congress extends it by that date.

Although supporters of making the ban permanent had enough votes to amend the bill to their liking, Democratic leaders put it on the floor under suspension of the rules, a procedure that bars amendments and is usually reserved for less controversial legislation.

The NAM issued a statement on passage from our vice president for tax policy, Dorothy Coleman:

We heartily commend Rep. John Conyers (D-MI), Chairman of the House Judiciary Committee, and ranking member Lamar Smith (R-TX), for their leadership and work in moving this bill forward. We also commend the long-standing support of Rep. Anna Eshoo (D-CA) and Bob Goodlatte (R-VA) and others to extend this moratorium, and appreciate their commitment to making it an important priority of the House.

American businesses of all sizes rely on high-speed, broadband Internet access to remain competitive in the global marketplace. If the moratorium is allowed to expire, more than 7,000 tax jurisdictions will have authority to tax Internet access. U.S. manufacturers already face a 31.7 percent structural cost disadvantage compared to our nine major trading partners; allowing the ITM to expire could only add to that disadvantage.

We call on the Senate to follow the House’s lead and act quickly to extend the ITM before the November 1 deadline.

That's just around the corner, right? November 1st, that is.

Posted by Carter Wood at 3:10 PM | Click here to comment | Send to a Friend

September 24, 2007

Cracking Down on Theft of Intellectual Property

Excellent editorial column in the South Bend Tribune this weekend (we don't read the sports pages there any more). Ed Semmler writes on U.S. efforts to counter theft of intellectual property, sees progress and more to be done.

There have been some significant wins in recent days for those interested in preserving American jobs.

Just over a week ago, Yuan Hongwei was arrested by authorities at London's Heathrow Airport on two counts of illegal use of trademarks belonging to South Bend-based ABRO Industries.

On Wednesday, U.S. Rep. Joe Donnelly joined other congressmen in introducing legislation aimed at putting the brakes on the theft of intellectual property.

Both actions show that officials have become serious about stopping the theft of intellectual property.

We don't immediately find the House bill, but the Senate version is S. 522, Intellectual Property Rights Enforcement Act.

The story of the Chinese counterfeiter who stole ABRO's identity is astonishing for its, well, whatever the Chinese word for chutzpah is. The Hunan Magic Power Industrial Company, run by Yuan Hongwei, has been selling counterfeit products under ABRO's label since 2002, at least. A sting in Louisiana undercovered the crimes, and Yuan Hongwei was seized in England last week. VOA story:

Yuan is accused of violating U.S. trademark laws by producing and selling various chemical products such as adhesives and lubricants under the name of a U.S. company. The American firm, ABRO Industries, says it has lost tens of millions of dollars from the sale of these counterfeit products around the world, because they saw their share of the market taken over by these fake goods.

Tip of the iceberg, unfortunately.

Posted by Carter Wood at 11:59 AM | 2 comments; click here to read them or submit your own! | Send to a Friend

September 21, 2007

Internet Tax Ban: Down to the Wire?

The federal ban on taxing Internet access is set to expire on October 30th. The freedom from taxation has helped create a dynamic Internet with low entry costs, responsive to the demands of the marketplace. So what's taking Congress so long in making the ban permanent?

Senator Ron Wyden (D-OR) weighed in on the topic Thursday, while three Republican Senators held a news conference to push for a permanent ban. If the ban expires, state and local governments will impose taxes, sure as shootin'.

If Congress makes the ban permanent, nothing would stop Internet providers from trying to expand the number of untaxed services, David Quam, director of federal relations for The National Governors Association, said in June. "The temporary provision keeps everyone honest," Quam said then.

But Senator John Sununu, a New Hampshire Republican, argued Thursday that a permanent ban is needed. If there's a problem with bundled services, that can be worked out in the bill, he said.

The Internet is "critically important to interstate and global commerce," Sununu said. "It makes no sense to have a national and global communications and business network to be subject to taxes by every state, city and county in the country."

Right. Also, for years and years now, we have heard about the deletrious effects of the "digital divide," the lack of Internet services for poor and rural communities. If a member of Congress is serious about addressing that issue, then he should get behind the permanent ban.

The NAM has sent a letter to the House and Senate endorsing the permanent tax moratorium. To read the letter on H.R. 743, the Internet Tax Freedom Act, please click here.

Posted by Carter Wood at 10:22 AM | Click here to comment | Send to a Friend

September 18, 2007

National Summit on American Competitiveness

Today's a busy one just across Pennsylvania Avenue from NAM-HQ, the Ronald Reagan Building, as Secretary Gutierrez and the Commerce Department hold a daylong National Summit on American Competitiveness. We congratulate the sponsors for organizing the event, which certainly reflect the big picture items the NAM works on:

America’s economic leadership in the 21st century is directly tied to the competitiveness of four key economic drivers: the role of the private sector; education and workforce issues; energy independence; and partnerships in innovation.

Rather than go through the agenda, let's just list who see who is scheduled to speak, take part in a panel, or participate in another fashion. It's a long and impressive list, so we'll put it in the extended entry. Several top execs from NAM's member companies, we note.

You can watch the event on a webcast by going to this site.

Haley Barbour
Governor of Mississippi

Craig Barrett
Chairman, Intel

Maria Bartiromo
Anchor/Editor, CNBC

Sandy K. Baruah
U.S. Assistant Secretary of Commerce for Economic Development Summit Emcee

Arden Bement
Director, National Science Foundation

Elaine Chao
U.S. Secretary of Labor

Henry Chesbrough
Faculty, UC Berkeley, Author, “Open Innovation”

James Connaughton
Chairman, White House Council on Environmental Quality

G. Wayne Clough
President, Georgia Tech

Chad Holliday
Chairman and CEO, DuPont

Gary Jacobs
Chairman, High Tech High

Floyd Kvamme
Partner Emeritus, Kleiner Perkins

Patrick Lo
Chairman and CEO, Netgear

John Marburger
Director, White House Office of Science and Technology Policy

John B. Menzer,
Vice Chairman and CAO, Wal-Mart Stores

Michael Porter
Professor, Harvard Business School

Carl Schramm
President, Ewing Marion Kauffman Foundation

Frederick Smith
Chairman and CEO, FedEx Co-Chair, Securing America’s Future Energy

Margaret Spellings
U.S. Secretary of Education

Susan Story
President and Chief Executive Officer of Gulf Power Company

Rick Wagoner
Chairman and CEO, General Motors

Deborah Wince-Smith
President, Council on Competitiveness

Daniel Yergin
Chairman, Cambridge Energy Research

Posted by Carter Wood at 6:33 AM | 1 comment; click here to read it or submit your own! | Send to a Friend

September 10, 2007

Patent Reform Has Problems, More Work to Do

Catching up on Friday's vote to approve H.R. 1898, the Patent Reform Act, by a vote of 220-175 (a bipartisan split). The Washington Post's story on passage was pretty good; The Hill had a piece about organized labor getting involved, which struck some observers as odd; the unions held their fire on final passage on assurances that more work would be done on the Senate side.

The serious problem with the legislation is its provisions governing the determination of damages and the resulting awards. The Coalition for 21st Century Patent Reform elucidates in a news release:

The damages section in the House passed bill proposes a new, untested ‘prior art subtraction’ requirement that is fundamentally flawed and unworkable.

The damages methodology mandated by H.R. 1908 heavily favors infringers, as most inventions are not as valuable at the time they are first conceived as they are after the inventor invests time and money to develop, manufacture and market them. Moreover, it is widely accepted that the economic value of an invention at the time it is made is largely unrelated to its current commercial value. Many great technological advances are simply ahead of their time, and do not become commercially valuable, if ever, for years after their creation. This is why, under current law, reasonable royalty damages are determined by looking to the marketplace value of the use of the invention at the time infringement began. This is the only fair way to compensate an inventor for what has been taken from him by the infringer.

The Administration's Statement of Principle, which raises several other objections, is available at the White House website here.

UPDATE (10:25 a.m.): From Forbes:

"We'd like to see more debate, more hearings, more negotiation," says Marc-Anthony Signorino, director of technology policy for the National Association of Manufacturers, one of the country's largest industry groups. "Even a brain surgeon needs to be trained for a while to understand how the brain works."

Posted by Carter Wood at 7:56 AM | Click here to comment | Send to a Friend

September 4, 2007

Patent Reform Pending -- Clarification

Below, in the week ahead post, we reported that H.R. 1908, the Patent Reform Act of 2007, could come to a House floor vote this week. Although that assertion was based on the Majority Leader's weekly update, a House vote that soon does appear unlikely. The bill is before the Rules Committee on Thursday afternoon, and the House tends not to vote on measures on Friday, so expect action further away.

Posted by Carter Wood at 11:33 AM | Click here to comment | Send to a Friend

August 31, 2007

Wi-Fi Die in San Francisco

On February 28, the Pacific Research Institute released a study, Wi-Fi Waste: The Disaster of Municipal Communications Networks on the inevitable failure of government-owned, citywide wi-fi networks. The summary:

San Francisco—Government-run municipal telecom networks erode private investment, slow high-tech innovation, mislead consumers, and serve the interests of politicians according to a report published today by the Pacific Research Institute (PRI), a California-based free-market think tank.

That was February. This is today. From the Chronicle:

Mayor Gavin Newsom's high-profile effort to blanket San Francisco with a free wireless Internet network died Wednesday when provider EarthLink backed out of a proposed contract with the city.

The contract, which was three years in the making, had run into snags with the Board of Supervisors, but ultimately it was undone when Atlanta-based EarthLink announced Tuesday that it no longer believed providing citywide Wi-Fi was economically viable for the company.

So PRI has a proven and keen understanding of how regulation of communications and technology works, or rather, doesn't work.

A recommendation, then, of PRI's brand-new report, Net Gains or Net Losses? The Net Neutrality Debate and the Future of the Internet. From the news release:

San Francisco – Imposing a regulatory regime of "net neutrality" would harm consumers, quash innovation and investment, and prove difficult or impossible to change in the future, according to Net Gains or Net Losses? The Net Neutrality Debate and the Future of the Internet, a new report released today by the Pacific Research Institute (PRI).

“At its heart, the net neutrality debate is about price controls, and net-neutrality advocates want government regulation—rather than the open market—to determine what we pay for using the Internet,” said K. Lloyd Billingsley, editorial director at PRI and author of Net Gains or Net Losses?

Report available here in .pdf.

PRI's analysis was dead on about the faults of municipal wi-fi. Seems like we should pay attention to the institute's analysis of net regulation, too.

Posted by Carter Wood at 8:44 AM | Click here to comment | Send to a Friend

August 30, 2007

Sam Brownback: Expect A 'Nasty Fight' With China

We just have to get tougher with them (China). We have to get tougher with them were it counts – which is dollars. I would be willing to put tariffs on China for their failure to defend and to protect our intellectual property in china or and their failure to allow their currency to float.

That's Senator Sam Brownback, calling for the United States to ratchet up the pressure against China. A Republican candidate for President, the Kansas Senator talks about trade and U.S.-China relations on this weekend's "America's Business with Mike Hambrick." He's not shying away from conflict. More Brownback:

We have to recognize and prepare the American public that this could be a nasty fight that takes place. Are we going to just continue on this route that we are on and allow them to steal 90% of the intellectual property that ends up in their country?

You can listen to the Senator's comments through an .mp3 soundfile here.

For more on "America's Business with Mike Hambrick" and to listen to the new show beginning Friday, please go to the AB homepage.

Posted by Carter Wood at 3:34 PM | Click here to comment | Send to a Friend

August 29, 2007

Mutations, We Need More Mutations

Ronald Bailey at Reason takes on the anti-bioengineering kooks activists with an interesting, well-reasoned (ahem) blog entry.

If anti-biotechies are so afraid of genetic changes in their foods, why aren't they out protesting varieties produced by means of mutation breeding? After all, most biotech crops merely change agronomic characteristics, whereas many irradiated varieties have different nutritional profiles.

The point here is NOT that mutation breeding is inherently dangerous. Given a solid record of 80 years of safety, it's not. The point is that the more precise methods of modern gene-splicing are even safer and should therefore be subject to even less regulation than crops produced by mutation breeding.

Modern crop research is really the key to replicating Norman Borlaug's Green Revolution to the benefit of humanity.

And Bailey doesn't even mention the possibilities of cellulosic ethanol.

Posted by Carter Wood at 8:45 AM | Click here to comment | Send to a Friend

August 27, 2007

Health IT: It Will Take Some Adjustment

Today's Baltimore Sun features a page one story on the increasing use of information technology in hospitals, with pictures of a pill-delivering robot and wireless-connected computer tablets to update patient records.

The thesis of the story is that health IT can bring much-needed efficiencies but it takes some time for people using it -- nurses, especially -- to adjust, and they complain that the electronic gizmos take away from patient care. Also, the younger generation of medical personnel seem more welcoming. For example:

Hopkins nurse Monica Wilt, 31, is deft as she logs into a prescription-ordering system, pulling up a list of her patients to see who needs medication.

She loves the software. "For people really familiar with computers, this is all very intuitive," she said.

Colleague Rosmond Lynch, who has 23 years of nursing experience, was not so quick to embrace changes. "At first I was scared and anxious. It seemed easier to glance at papers than the computer," Lynch said. But with training and support, Lynch said she welcomed technology as an aid rather than a hindrance.

Just seems like a case of human nature, resistance to change. The need for efficiency and quality patient care will win out in the end.

Anyway, good story about the actual application of health IT. Oh, and the lead photo is of Bret Anderson, RN, using a Motion C5 tablet to enter patient info. Here's a link to the Motion device. Very cool.

Posted by Carter Wood at 9:50 AM | Click here to comment | Send to a Friend

August 24, 2007

A Permanent Ban on Internet Taxes?

Make the ban on Internet access taxes permanent to encourage investment and innovation.
The NAM is a member of a broad coalition, Don't Tax our Web. Really broad. And describing the issue in a clear fashion is this piece from Forbes.com.

"Companies have to be able to plan, they have to have a sense of what their costs will be," says Broderick Johnson, a spokesman for the umbrella group. "The problem with a temporary moratorium is that it certainly sends a signal that this may expire."

And regarding the state vs. federal question, Johnson says that for nearly a decade, it has been Congress' policy that the Internet is "not burdened by state and local taxes."

The Internet would seem to fall under broad Commerce Clause applications, right?

The NAM's July news release urging a permanent ban on taxing Internet access is here.

Posted by Carter Wood at 8:47 AM | Click here to comment | Send to a Friend

August 23, 2007

Richard Epstein: Perverse Incentives and Medicines

Very interesting podcast interview (courtesy of Glenn Reynolds and Helen Smith at Instapundit) with Richard Epstein, a law professor at the University of Chicago, and the author of "Overdose: How Excessive Government Regulation Stifles Pharmaceutical Innovation." Epstein hits on a favorite theme of ours, that regulatory regimes create all sorts of perverse incentives.

[If] you impose regulatory impediments, the hidden but very real cost of that is a delay in introduction. Delays in introduction matter in this business, and the less good treatment that you get, and the more money that you have to pay for it, the greater the suffering that you will see and the shorter the life expectancy and the higher rates of morbidity. And so, what one has to do is to rethink the question as to whether or not various rules which are designed to protect people against themselves, and various rules that are designed to protect other kinds of interests, like low prices and so forth, in the long run are going to serve the goals they have.

Along with the regulatory environment, Epstein talks about the effects of the legal and political climate on the pharmaceutical industry, which he views as often attacked by very simplistic accusations of malfeasance, when the reality is much more complex. And talk about the most perverse of incentives: It's terrible if we kill you, but if we let you die, that's all right.

Epstein addresses lots of topics -- barriers to entry, biases of the media, the need for patient activism. A clear presentation of the value of competition in the marketplace.

Instapundit is often a good place to turn for this brand of argument; Reynold's wife, Dr. Helen Smith, lives a healthy life thanks in part to Tikosyn, a drug used to treat heart arhythmia. The U.S. system of patents, intellectual property rights and health care have encouraged innovation in prescription drugs; heavier regulation -- and litigation -- will certainly discourage the R&D that leads to breakthroughs and new medicines.

Posted by Carter Wood at 1:06 PM | Click here to comment | Send to a Friend

August 10, 2007

The R&D Tax Credit: Make It Permanent

No ambiguity in this statement from President Bush's news conference yesterday:

I believe Congress ought to make the research and development tax credit a permanent part of the tax code, to encourage investment.

NAM President and CEO John Engler highlighted those comments in the news release yesterday that applauded the president's signing of the America COMPETES Act.

Our greatest strength in global competition is our commitment to innovation, and the R&D tax credit is a critical component of that commitment. This battle should not have to be re-fought each and every year. Let’s make it a permanent fixture of our tax system.

The politics of the R&D tax credit are always difficult. The credit is often used as a legislative "sweetener," a favored provision that can be added to an otherwise mixed bill to make it more palatable. The inveterate tax-raisers also enjoy having a regular measure they can support, giving them at least one pro-business, pro-investment, tax-cutting credit to their name.

But the maneuvering and inevitable delays that go along with this kind of politics do real harm to U.S. R&D competitiveness. The uncertainty discourages companies from investing in U.S.-based R&D, and it's entirely possible that politics could, eventually, prevent the temporary credit from being renewed. The result would seriously damage the innovation climate in the United States.

Best to sacrifice the positioning in favor of serious-minded, consistent tax policy. Make the R&D tax credit permanent...and better.

The NAM's legislative agenda on tax policy has a good discussion of the R&D tax credit. You can read it here.

Posted by Carter Wood at 9:21 AM | Click here to comment | Send to a Friend

August 9, 2007

Making the U.S. More Competitive

President Bush today signed H.R. 2272, the "America COMPETES Act" or the "America Creating Opportunities to Meaningfully Promote Excellence in Technology, Education, and Science Act." It's a solid package of ed