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Cost-effective “infrastructures” – both physical and legal – provide the essential platforms for the activities of all economies. In the physical realm, for example, it is hard to imagine life without roads, communications networks, airports, ports, sewer systems and electricity grids. Because of their “public good” nature, government plays a central role in financing, if not operating, such infrastructure facilities. In turn, because so much infrastructure is local, the planning and construction of many projects historically has been delegated to the states (although aided by federal financing).
For the past five years, the National Dialogue on Entrepreneurship has helped expand the discourse about how to best to advance innovation and catalyze economic growth beyond “small business” to debates on science, technology, engineering and research. While we will continue to advance discussion driven by developments in the all important innovation economy, the initiative will carry a new name - the Policy Dialogue on Entrepreneurship (PDE). PDE will pick up exactly where NDE left off -– broadening attention to the field of entrepreneurship and connecting thought leaders looking to advance it.
Congress is considering the American Recovery and Reinvestment Bill of 2009. This new $825 billion economic stimulus package includes $275 billion in economic recovery tax cuts to individuals and businesses over two years, making it clear that the U.S. is relying heavily on entrepreneurs to jumpstart our economy. And they’re right to do so.
Times are tough. Layoffs are growing every day and despite massive government intervention, there is little talk of anything more than a slow prolonged recovery. There are a few reasons though to remain optimistic. The main one: as long as we have entrepreneurial people, jobs will be created, and when times get tough we learn to do more with less. There are many entrepreneurs out there who see new and better opportunities for innovation now we are in the midst of crisis.
Making what is urgently needed consistent with what is needed for the long-term is not a bad idea. The current House bill on the economic stimulus nicely blends the short- and long-term perspectives, particularly in the way it addresses renewable energy. The challenge now is to figure out how to achieve progress in developing and commercializing green technologies without turning the government into an obstacle to the entrepreneurial innovation needed to end the climate change and economic crises.
Employment in the U.S. has been in a free fall. Payroll employment has declined by 3.6 million since the start of the recession in December 2007, according to the latest report from Bureau of Labor Statistics. Firms have shed jobs every month since January 2008. Last January alone, the national payroll dropped by 598,000 jobs. The unemployment rate has risen from 4.9 percent in January 2008 to 7.6 percent in January 2009. Is it time to consider a payroll tax cut?
Have you ever thought about the contribution that universities can make to an economy? Here’s a fact: Around 6,900 MIT-alumni companies with worldwide sales of approximately $164 billion are located in Massachusetts, representing 26 percent of the sales of that state’s companies. MIT’s impact extends to the national level with, for example, 4,100 alumni-founded firms based in California generating an estimated $134 billion in worldwide sales.
Although the reputation of the U.S. has gone through some bumpy air of late, we have consistently been held in high regard for our entrepreneurial prowess and culture. Even during these times of great economic stress, we are flooded with enthusiastic visitors from overseas (both in person and on-line) searching to understand and replicate the ecosphere that has fostered so much job creation and growth.
Readers of this column are now well acquainted with this author’s views on the central role in re-starting the global economy of those unperturbed citizens around the world who see opportunity rather than doom. Often driven by a desired to do well and do good and an interest in not working for Wall Street’s CEOs but using them as mentors, our new generation of entrepreneurs are geared up and underway. They are also global in their mindsets.
We should approach innovation in a similar fashion, taking steps to boost R&D and the commercialization of new technologies at home, while at the same time scouring the world to help those with the best innovative ideas, programs and policies that nurture innovation. When the fires burn out and the market bottoms out, it will be the entrepreneurs who seed the new ideas and jobs from the ashes.
We have received an overwhelming number of “wake-up calls” alerting us to the need for change. Because such change can only arise from innovative thinking, we must nurture the innovative mind. Young, creative people around the world have the potential to design solutions to the most pressing global challenges, such as global warming, the spread of HIV/AIDS, and even financial risk monitoring.
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