Officials at Intel, the world's largest maker of semiconductor chips, are convening a high-level conference in Washington next month. Pictured: Intel Corp. CEO Paul Otellini. U.S. in need of tech reboot

For years, the U.S. was a pioneer, the renowned home of Yankee ingenuity. The United States put the first man on the moon and invented the light bulb. The country gave the world the daring Wright brothers, billionaire computer genius Bill Gates, Google and the iPod.

But lately, experts say, the U.S.’s creative streak has sputtered. Today, it has gone from being the No. 1 innovative country in the world to No. 6 and has made less progress in international competiveness and innovation than 40 other nations and regions measured in the past decade.


Concerned about the failure to innovate — and convinced that it is the key to a vibrant economy — officials at Intel, the world’s largest maker of semiconductor chips, are convening a high-level conference in Washington next month. There, Obama administration officials, high-tech gurus, NGOs, corporate titans and academics will share ideas on how to spur economic recovery through innovation.

“You need to create circumstances that encourage risk-taking and entrepreneurship,” said Peter Cleveland, Intel’s vice president of government relations. He said the conference will explore what skills U.S. workers need to compete in industries of the future, including green technologies, and will tackle how to foster creativity, make scientific investments a priority and encourage cooperation between the public and private sectors.

Industry’s focus on innovation as a key to the future dovetails with White House thinking, and several senior administration officials will participate in the conference, including top economic adviser Larry Summers, Education Secretary Arne Duncan and Austan Goolsbee, staff director and chief economist on the president’s economic recovery board. Other scheduled participants include America Online founder Steve Case; Jeff Immelt, the chairman and CEO of General Electric; D.C. Public Schools chief Michelle Rhee; and Joel Klein, chancellor of the New York City Department of Education.

In February, when consultants at Mc­Kinsey & Co. asked executives how the government should spend federal stimulus funds, 59 percent answered, “fostering innovation and potential new industries.”

Verizon CEO Ivan Seidenberg echoed that sentiment last week when he proclaimed “investment and innovation has never been more important than it is right now.”

“In the face of a global recession, economies all over the world are looking for ways to become smarter, more productive and more competitive,” he said at a broadband industry conference in Chicago. “The key to a smart economy is smart technology that can change business models and change society.”

President Barack Obama embraced the same message last month when he outlined the “groundwork and the ground rules to best tap our innovative potential.” Building on more than $100 billion in stimulus funding, he promised to invest more in research, promote policies that foster entrepreneurship and provide federal backing for clean energy, advanced vehicles and health care technology.

“By 2020, America will once again have the highest proportion of college graduates in the world,” Obama said. “We used to be No. 1. We should be No. 1 again.”

That, however, is a formidable challenge. Tight credit markets have driven companies to stash away cash, cut wages and lay off workers. Companies in Standard & Poor’s 500 index chopped 5 percent of their research and development costs and 25 percent of capital expenditures between the end of the third quarter last year and the second quarter of this year, according to the index.

To match Finland’s investment in technology programs on a per capita basis, the U.S. would need to invest $33 billion each year, said Robert Atkinson, president of the Information Technology and Innovation Foundation. Today, the U.S. spends about $2 billion.

“In reality, innovation is not manna from heaven,” he said. “It’s human made and influenced by policy.”

Many experts believe that policy imperative begins with investing more in education. Over the past decade, numerous studies show, the United States has failed to raise math and science test scores, and students in several Asian countries consistently score higher in both subjects.

Economic turmoil often breeds technological breakthroughs. During the Depression, DuPont invented nylon, which paved the way for parachutes and toothbrushes. The dot-com bubble burst in 2001, but that same year, Apple introduced the iPod.

The hope is that history will repeat itself. Intel Chairman Craig Barrett has been repeating the company’s mantra: “You can’t save your way out of a recession.”

In February, Intel CEO Paul Otellini announced plans to spend $7 billion to build advanced manufacturing plants in Oregon, Arizona and New Mexico. The company funded mini-documentaries produced by PBS’s “NewsHour With Jim Lehrer” that examined the role of innovation in the economy. Intel and the Aspen Institute also hosted dinner discussions featuring Summers, Energy Secretary Steven Chu and Chief Technology Officer Aneesh Chopra.

The Aspen Institute, the journal “Democracy” and PBS are co-hosting the Nov. 30-Dec. 1 Intel Conference. Lehrer and PBS correspondents Gwen Ifill and Judy Woodruff will be among the moderators.

“It was definitely not hard to get people to participate in the conversation, because it’s on everyone’s mind,” said Jamie Miller, Aspen’s vice president for public programs.

“You look at the auto industry and places like Detroit, and there’s a fear that if America’s not at the cusp of innovation, we will not be able to pick ourselves up and dust ourselves off,” she said.

Said Atkinson: “We were ahead so long — really since the ’50s — that we were kind of blind to the threat going on.”