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Remarks by Commerce Secretary Wilbur L. Ross at the First Meeting of the National Council for Expanding American Innovation

Thank you, Andrei, for the kind introduction, and for your leadership at the U.S. Patent and Trademark Office during these tumultuous times. I must first say how sorry I am not to be present in person. I had been eagerly awaiting this event, but recent events in the Middle East require me to be with the Qatari delegation this whole day through dinner. We commend you and your team for creating this new Council at a critical juncture in American history.

This is a seminal event that is long overdue. The National Council for Expanding American Innovation is ground-breaking, and it is long overdue. I am grateful to serve as a government member along with you, Andrei; and the Directors of the National Science Foundation, Dr. Panchanathan; and the Small Business Administration, Jovita Carranza.

Thank you also to the CEOs of GM, Bristol Myers, Oracle, J and J, Qualcomm, Eli Lilly, and 3M for joining other leaders from the business, academic, inventor, and venture capital sectors for participating. The country needs and deeply appreciates people like you who are civically engaged, and dedicated to improving the livelihoods of every American.

The new Council will address the challenges the United States faces in maintaining its position as the world’s most innovative nation. American innovation has improved the quality of life for billions of people on the planet. Our success as a nation is tied to our collective embrace of invention, of creating new products, new companies, new industries, and new jobs for hundreds of millions of Americans.

Imagine during the coronavirus pandemic what our economy would be like if Americans were not able to telework? It took decades, hundreds of billions of dollars of investment in R&D, and trillions of dollars of capital equipment to transform our economy from analog to digital. This collective innovation has kept the global economy afloat.

And it started long before the invention of the microchip by Bob Noyce and Jack Kilby in the 1950s, and digital networks and photonics in the 1980s. Moore’s Law, the doubling of computing capability every 18 months, was suddenly being applied to industries and processes far afield of computing. And now everyone has a Dick Tracy phone in their pocket, possessing more computing power than the world’s most sophisticated supercomputers had a generation ago.

But today, we have foreign competitors intent on displacing the United States as the global engine of innovation, ingenuity, and industry. They are doing so by both legitimate and illegitimate means.

In its latest Science and Engineering Indicators Report, NSF notes that China is quickly closing the S&T gap with the United States. China’s average annual growth rate in R&D spending was 17.3 percent between 2000 to 2017, compared to 4.3 percent for the United States.

China has surpassed the United States in the number of research publications, accounting for 21 percent of the global total, compared to the U.S. at 17 percent. And in the important the area of patenting, Chinese inventors accounted for 49 percent of the utility patent “families” granted globally in 2018, compared to 6.8 percent to U.S. inventors.[i] In fact, the number of patent applications in China last year ─ at 1.46 million ─ was almost three times greater than in the United States, at 515,000.

And the trend lines are not in our favor. Over the past five years, U.S. patent applications have increased only marginally, whereas they have doubled in China. China is marching headlong toward the goals set forth in its China 2025 strategic plan. It has targeted domination of our most important technologies, and our most important industries.

The 2025 date is no accident. It will mark the hundredth anniversary of the Chinese Communist Party’s founding in Shanghai in 1925. It is investing hundreds of billions in its universities and in the creation of national champions aimed at dominating technological development and global markets.

We see the results in dozens of other indicators, including our trade balance in advanced technology products, our declining market shares in numerous industries, and the growing number of Chinese students studying the physical sciences and engineering. And, now, with the coronavirus, China has upped the ante, using the global pandemic to seek an even stronger foothold in global advanced technology markets.

President Trump, Director Iancu, the team at Commerce, the American people, and all of you understand what is at stake. At the Trump Administration, we have been addressing these challenges with new tax, trade, regulatory, and workforce policies. But we have a lot more to do. Simply stated, too small a segment of the American population is engaged in the innovation economy, and in the creation of inventions, the development of new and novel products, and the formation of entrepreneurial companies.  Because of the SUCCESS Act, the USPTO studied the available literature and found deep inequalities that exist in the innovation enterprise, with a plethora of white males, and a dearth of minorities, women, and veterans.

We will have difficulty being successful as a nation if we do not have more people engaged in the creative economy. It is your charge to change this dynamic and do so quickly. What you propose as a National Council must permeate throughout all of America’s industries, its academic settings, and its government offices. We must chart a lasting path to permanent change. Please, do not just write a report that sits on a shelf. We have too many of those already.

You must develop a concrete and implementable plan to enlarge engagement in our innovation enterprise, not by a little, but by a lot. History must remember this initial Council meeting as a great day for America, when a fresh energy was unleashed across the country in communities that need new hope. It must boost the economic and quality of life for this country in a way that has never been seen before.

It is my honor to be part of today’s event, and I sincerely wish you the very best in this endeavor. Thank you.

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