‘Star Wars’ and <i> Economic </i> Power : U.S. Pays Too Little Attention to Possible Effects of Program
Both sides in the debate over President Reagan’s Strategic Defense Initiative spend most of their time quarreling over whether development of an effective defense against ballistic missiles is possible, and whether the effort to find out is a help or hindrance to arms-control efforts.
Too little public attention is being paid to another question that deeply concerns our European friends (and possibly our Soviet adversaries): What will be the effect of this potentially huge research-and-development program on the economic distribution of power in the world?
Some U.S. experts, including some well-placed insiders, worry privately that the quest for an effective strategic defense will soak up a disproportionate slice of America’s scientific manpower, impairing this country’s long-term ability to compete with the Japanese in other economically important areas of high technology.
The flip side of this argument is that SDI shapes up as the world’s most exciting research effort, and that the technological spinoff could be of enormous benefit to America’s economic competitiveness.
Top Reagan Administration officials do not appear to think much about the economic side effects of the planned $26-billion investment in “Star Wars” research. Lt. Gen. James Abrahamson, who heads the SDI program, has been quoted as saying that technological fallout for the U.S. economy will be incidental to the military purpose of the research effort.
Allied political leaders make no effort to hide their concern that, in terms of European peace and security, the strategic defense program might cause more problems than it would solve. But it is the broader economic ramifications of the Star Wars program that underlie West European misgivings.
During the 1960s and 1970s Western Europe was on a roll. Unemployment was lower than in the United States. Economic growth and gains in productivity were higher. As a British economist puts it, “The common perception was that Europe was just better than America in every respect.”
That perception has changed--not so much here, where intelligent Americans are appropriately worried about the massive and dangerous budget and trade deficits, as in Europe.
Economic growth in Europe has lagged in the 1980s. Unemployment went up, and stays high despite moderate economic recovery. Over the last decade the United States has created seven times as many jobs as all of Europe.
A lot of those U.S. jobs, of course, were in fast-food restaurants and similar enterprises having little to do with global competitiveness. The U.S. manufacturing sector is much less robust than its European counterparts, which have enjoyed an export boom at American expense.
What alarms thoughtful Europeans, however, is the specter of a technology gap between Europe on the one hand and the United States and Japan and the other.
Western Europe is hardly a high-tech basket case. In nuclear-reactor technology, commercial exploitation of space and transport aircraft, to mention but a few areas, the Europeans are holding their own. But in computer-related technologies they are not.
In an illuminating speech early this year, Hans-Dietrich Genscher, West German foreign minister and a leader of the Free Democratic Party, warned that Europe could not afford to continue falling behind in the all-important new technologies involved in the information revolution.
Europeans are producing 64-kilobit memory chips, while the Japanese and Americans have been making 256-kilobit chips since 1982. European companies manufacture microprocessors only under American license, and account for only 5% of the world market in integrated circuits. U.S. companies dominate the European market in computers and data banks.
Genscher also expressed concern that Europe might fall hopelessly behind in such areas as genetic engineering, new materials and exotic energy technologies.
It was against this background that Reagan sprung his Star Wars proposal, which by nature involves large-scale research into futuristic technologies. The follow-up invitation for European participation has drawn mixed reactions.
European governments fear that SDI will goad the Soviets into responses that will threaten the military balance in Europe, and that enormous investments in the program will force reductions in U.S. and possibly European expenditures for more down-to-earth defensive systems.
Yet the Europeans dare not be left out of a project that is seen as comparable to the Manhattan Project of World War II and the lunar-landing program. With full European participation, a third of SDI funds might be spent overseas. But if America is left to go it alone, the Europeans fear a damaging brain drain--and spinoffs into commercial technology that would leave them hopelessly behind.
The strategy of allied governments so far is to fend off formal participation in SDI while allowing individual companies to go after SDI business. Meanwhile, 17 European countries are moving to coordinate their research-and-development efforts in something called Eureka, which will seek to exploit Star Wars-type technologies for basically commercial purposes.
It remains to be seen what will come of it all. But it seems clear that Washington, by paying insufficient attention to the economic ramifications of the SDI program, runs the danger of creating the worst of possible worlds for America.
We may fail to enlist significant European participation in the Star Wars anti-missile program, but goad Europe into continent wide cooperation on futuristic technologies. And whereas we would be held back from commercial exploitation by national-security considerations, the Europeans would suffer no such encumbrance. Thus they might get more economic benefit from a much smaller program.
If the United States is to pursue a Star Wars program of the magnitude envisioned by the Administration, common sense dictates that the project be deliberately structured for maximum benefit to America’s competitive position in the world.
