Taxpayers Can Give Business Helping Hand
As you may know, scientists at the University of Houston and at IBM and AT&T; have recently made exciting discoveries in materials and processes, called superconductors, that will one day conduct electricity much more efficiently and cheaply.
The promise of their work is fantastic: Whole cities lighted by a few cables. And the prospects for new industries--years from now when superconductors go from laboratory to commercial reality--are tremendous.
But these days, we no sooner advance in technology than we have to worry about falling behind. Japan’s Ministry of International Trade and Industry (MITI) has already organized scientists from government, universities and 100 major companies in a combined effort to find commercial applications for the University of Tokyo’s superconductor discoveries. The legendary Japan Inc. is getting its act together.
So Sen. David Durenberger (R-Minn) wants the United States to do likewise. He has introduced legislation setting up a commission to coordinate government, university and business efforts in superconductor research and production.
Durenberger’s concern is admirable. He recognizes that technological leadership guarantees a continuing supply of new industries and jobs. And the Minnesota senator also appears to realize something that is often denied or overlooked, namely that U.S. business has a long history of benefiting from government-backed technology.
True enough, we don’t tend to succeed with big cooperatives, a la the Japanese. Our most recent attempt, the 21-company research venture called Microelectronics & Computer Technology Corp. of Austin, Tex., has produced little but bureaucratic inertia in four years. (Lest we forget, Japan Inc. boots a few, too. This decade’s Fifth Generation Computer Project, involving all of Japan’s technology companies, was supposed to make computers as powerful and versatile as the human brain. It didn’t come close, and Japan still trails in virtually every aspect of computer technology.)
But the U.S. system works beautifully when government gives a boost and then lets industry develop as it will. The transistor, for example--the last big advance in electricity--was developed at Bell Labs with help from a government contract. And, despite fierce competition, U.S. industry still holds the technological lead in semiconductors.
We can better understand the process if we look at MacNeal-Schwendler Corp., a small Pasadena company that won a government contract and developed the world’s leading computer program for structural analysis--meaning that instead of stress-testing a car or airplane part by banging it against a wall, engineers simulate the part and the stresses mathematically in the computer.
In 1964, the National Aeronautics and Space Administration needed such a program to test how a trip to the moon might affect metal capsules. And Richard MacNeal and Robert Schwendler, two consulting engineers who had formed a company by investing their $18,000 life savings, won the competition and produced a successful program called Nastran.
But in 1970, MacNeal-Schwendler’s government job ended. NASA put Nastran--which the taxpayers had paid for--into the public domain, meaning any U.S. company could use it. And some big ones tried to, including General Motors and Lockheed. But they needed MacNeal-Schwendler’s help in running the program, and adapting it to industry needs, and in developing it further. The business had only begun.
Today the world standard in structural analysis is MacNeal-Schwendler’s program, which dominates engineering markets here and in Japan and Europe. MacNeal-Schwendler has grown to $27 million in revenue, is listed on the American Stock Exchange and led by the second generation of management, President Joseph Gloudeman, who spends $4 million a year on research to stay technologically ahead.
The point is there are hundreds of MacNeal-Schwendlers in the U.S economy, companies providing first-class products or services that got a push at the start from government. The making of IBM itself was a 1936 contract for punch card machines from the Social Security Administration.
Should the taxpayers provide a push for superconductors? Why not? That’s how the system works.
