THE DINOSAURS NEVER SAW IT COMING

The enigma, of course, is that America, by most measures, is prospering today. The nation produces 28% of the world’s economic product with less than 5% of the world’s population. America’s economy has been creating nearly 2 million net new jobs a year. Business Week ranks 8 US firms in the top 10 “most innovative” companies in the world. America has a gross domestic product close to $13 trillion and has contributed one-third of the growth in global output over the most recent 15-year period. Its household net worth is now over $55 trillion. U.S. universities employ 70% of the world’s Nobel Laureates.

According to the Times of London, seven of the top 10 universities in the world are in the United States. Jiao Tong University in China says the number is 8 of 10. It is interesting that a dissenting opinion comes from the US National Conference of State Legislatures in its recent report Transforming Higher Education, which concludes that although America has many fine colleges and universities, excellence is by no means uniform. It goes on to state flatly that “the American higher education system is no longer the best in the world. Other countries outrank and outperform us.” America’s academic institutions nonetheless have a culture that encourages innovative thinking and the free exchange of ideas, and our society, even with its shortcomings, is virtually unparalleled in its ability to absorb motivated, contributing people from around the world. Perhaps most important, we enjoy the benefits of a stable government and an economic system that encourages risk-taking and, left to itself, vigorously filters out noncompetitive firms and industries in favor of the growth firms and industries of tomorrow. Protectionism in the United States, although clearly not dead, seems to be in extremis.



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Is America Falling Off the Flat Earth? THE DINOSAURS NEVER SAW IT COMING The enigma, of course, is that America, by most measures, is prospering today. The nation produces 28% of the world’s economic product with less than 5% of the world’s population. America’s economy has been creating nearly 2 million net new jobs a year. Business Week ranks 8 US firms in the top 10 “most innovative” companies in the world. America has a gross domestic product close to $13 trillion and has contributed one-third of the growth in global output over the most recent 15-year period. Its household net worth is now over $55 trillion. U.S. universities employ 70% of the world’s Nobel Laureates. According to the Times of London, seven of the top 10 universities in the world are in the United States. Jiao Tong University in China says the number is 8 of 10. It is interesting that a dissenting opinion comes from the US National Conference of State Legislatures in its recent report Transforming Higher Education, which concludes that although America has many fine colleges and universities, excellence is by no means uniform. It goes on to state flatly that “the American higher education system is no longer the best in the world. Other countries outrank and outperform us.” America’s academic institutions nonetheless have a culture that encourages innovative thinking and the free exchange of ideas, and our society, even with its shortcomings, is virtually unparalleled in its ability to absorb motivated, contributing people from around the world. Perhaps most important, we enjoy the benefits of a stable government and an economic system that encourages risk-taking and, left to itself, vigorously filters out noncompetitive firms and industries in favor of the growth firms and industries of tomorrow. Protectionism in the United States, although clearly not dead, seems to be in extremis.

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Is America Falling Off the Flat Earth? All that comes at a price. To produce such great accomplishments, our economic system, evidencing its version of what has been called creative destructionism, destroys 29 million jobs each year while generating 31 million new jobs. In fact, about one-sixth of all jobs in the United States are destroyed in any given year. Mathematicians would describe the process as encompassing the most hazardous of calculations in that it concerns relatively small differences between relatively large numbers, and economists would say that the job market is highly volatile. But if one assumed a 10% adverse change in both job creation and job destruction, it would result in the disappearance of twice as many net jobs as are now being added. Such is the tenuousness of life in a modern economy. If the overall economy is doing so well, what is the concern? In a word, trends. Not only are others getting better, but also to a disconcerting degree America has in many respects been losing its own edge. Truly, America has enjoyed what for many have been the best of times—seldom if ever has the world seen a single nation with such broad predominance—but these are also the worst of times, inasmuch as we are slipping perilously and silently closer to the flat earth’s edge. Ironically, the nations that are emerging as our most serious competitors are doing so in large part by adopting the best of our institutional practices and often executing them better than we. In America, we are to a considerable degree living off past investments, the comparatively strong position the nation held at the end of World War II, and the prevalence of English as the predominant language of business, government, and technical education. But the impact of those discriminators appears to be diminishing. Simply stated, we have been eating our seed corn. Worse yet, this is a crisis that provides no sudden, dramatic warning as did, say, 9/11, Sputnik, and Pearl Harbor. In the present instance, the analogy much more closely matches the proverbial frog being slowly boiled. We are witnessing a gradual, albeit accelerating, erosion rather than a single cataclysmic wakeup call. Charles Darwin observed that “it is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change.” That conclusion seems to apply to human organizations as well as to biological organisms. There can be no more dangerous place to be than in first place: the one holding that exalted position becomes everyone else’s target and, perhaps worse, is the recognized beneficiary of the status quo—and therefore reluctant to promote, or even accept, change.

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Is America Falling Off the Flat Earth? We, of course, did not get into our intensifying plight overnight. Correspondingly, if we should fall decisively behind the leaders of the rest of the world, particularly in the prosperity drivers of science and engineering, it will take decades to catch up, if it is possible to do so at all. Consider the matter of producing one additional research scientist who can help to generate the knowledge from which future innovation and jobs will spring. Rather convincing empirical evidence suggests that most children who are “turned off” by mathematics and science have already arrived at that conclusion by the time they are in fourth grade. The die is usually cast by a teacher who finds teaching science and mathematics an unwelcome and intimidating burden or by a parent with a disinterest in or disdain for these fields. One of the unusual characteristics of a technical education is that by eighth grade a student must most often decide whether to preserve the option to pursue such a career, for example, in science or engineering, by deciding whether or not to take algebra to be prepared for higher-level science and mathematics courses in high school. That is in distinct contrast with the decisions faced by those who might wish to preserve the option to become lawyers, bankers, accountants, or medical doctors. The reason for the disparity is the hierarchic nature of an education in mathematics that serves as the foundation of science and engineering. One cannot usefully study trigonometry until one has mastered algebra (only 13 states currently require algebra II for a high-school diploma … up from 2 states in 2005); one cannot study calculus until one has learned something of trigonometry; and one cannot study differential equations until one has studied calculus. So fundamental is mathematics that it is in essence the language of science and engineering. Assuming that a person has completed the requisite courses during 4 years in high school and has successfully completed 4 years of undergraduate work (the average for engineers is now closer to 6 years), the person is prepared to begin a 6- or 7-year pursuit of a PhD, after which a creative research career can presumably begin. A few more years may in many cases be devoted to postdoctoral endeavors. As one might suspect, there is a great deal of leakage along that extended educational highway. To begin with, about one-third of US eighth-graders do not receive a high-school diploma. And of those who do, about 40% do not go on to college. About half who do begin college do not receive a bachelor’s degree. Of those who do receive such a degree, two-thirds will not be in science or engineering. And of those who are US citizens and do receive degrees in either science or engineering, only about 1 in 10 will become candidates for a doctoral degree in those fields. And over half the doctoral candidates drop out before being awarded a PhD.

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Is America Falling Off the Flat Earth? Furthermore, even after they receive their degree, a growing proportion of US graduates—in the case of baccalaureate engineers, slightly over half—decide to become investment bankers on Wall Street, lawyers, corporate executives, or some other form of worker. More S&P 500 CEOs receive their undergraduate training in engineering than in any other field, in spite of the minority of undergraduates who receive degrees in that field. About 23% of the nation’s CEOs majored in engineering, 13% in economics, and 12% in business; the remainder are trained in a broad variety of other disciplines. It can justifiably be argued that those who migrate from science or engineering into other fields still use their education for the betterment of society, but they generally do not then directly contribute to the nation’s research enterprise. The point is that it takes a lot of third-graders to produce one contributing research scientist or engineer and a very long time to do it. But that is only the beginning. The newly minted scientist or engineer must continue to pursue his or her education and the search for knowledge, at least informally, at an ever-increasing pace throughout his or her career or become professionally “middle-aged” by the time they are 30 years old. That is a consequence of the exploding supply of technical information in the world, which is said to double about every 2 years. Studies of the frequency of citations of scientific and technical articles suggest a half-life of such information, depending on the field, of about 3 to 6 years. Similarly, studies of the course content in university catalogs and qualitative surveys of science and engineering professionals indicate that, absent continued learning, the professional value of the specific knowledge imparted through their formal studies becomes negligible in about 5 years. This perhaps explains why there are seemingly always engineers seeking employment at the same time that employers are decrying an “engineering shortage.” Employers are seeking integrated-circuit and jet-engine designers, not vacuum-tube and propeller designers.