(Ed. Note: The “Innovation Fact of the Week” appears as a regular feature in each edition of ITIF’s weekly email newsletter. Sign up today.)
China engages in egregious “innovation mercantilism,” including massive tech subsidies and forced tech transfer, all designed to have China replace America as the global tech leader. It’s time for America to rise to the challenge by developing its own plan to maintain competitive advantage in advanced and emerging technology industries that are critical to U.S. economic and national security. Rob and Jackie discuss all of this—along with what an Energy and Commerce agenda might look like next for Congress--with Representative Cathy McMorris Rodgers (R-WA), Ranking Member on E&C’s Consumer Protection and Commerce Subcommittee.
- Daniel Castro and Michael McLaughlin, “Ten Ways the Precautionary Principle Undermines Progress in Artificial Intelligence” (ITIF, February 2019).
- Robert D. Atkinson, “How China’s Policies Have Stifled Global Innovation” (ITIF, January 2020).
- Robert D. Atkinson, “The Case for a National Industrial Strategy to Counter China’s Technological Rise” (ITIF, April 2020).
Rob Atkinson: Welcome to Innovation Files. I’m Rob Atkinson, founder and president of the Information Technology and Innovation Foundation. We’re a DC based think tank that works on technology policy.
Jackie Whisman: And I’m Jackie Whisman, I handle outreach at ITIF, which I’m proud to say is the world’s top ranked think tank for science and technology policy.
Rob Atkinson: And this podcast is about the kinds of issues we cover at ITIF, from the broad economics of innovation to specific policy and regulatory questions about new technologies. In this episode, we’re covering a lot of ground, China, emerging technologies, and regulatory hurdles, and we’re talking to a leader in the House of Representatives who shares our passion for all of these things.
Jackie Whisman: Yes, and since we have so much ground to cover let’s get right to it. Congresswoman Cathy McMorris Rodgers was elected to the House of Representatives in 2004 and represents Washington’s fifth congressional district, which is in the eastern part of the state. She serves on the House Energy and Commerce Committee, and is the top Republican on the Consumer Protection and Commerce Subcommittee. She’s a strong advocate for technology and innovation and we’re thrilled to have her here.
Jackie Whisman: Welcome, Congresswoman.
Cathy McMorris Rodgers: Well hello, great to be with you.
Jackie Whisman: Congresswoman, you’re leading a new package of legislation in the Energy and Commerce Committee that seeks to maintain US leadership on emerging technologies like AI, blockchain, autonomous delivery, and many other things that ITIF spends a lot of time thinking about. Why is this sort of legislation necessary right now?
Cathy McMorris Rodgers: Well even before the coronavirus hit I was leading on the Energy and Commerce Committee to promote America’s competitiveness, especially in emerging technology. I believe that in order for us to maintain our global competitive edge, to win the future, to beat China, it is so important that we are leading, leading on AI, leading on autonomous vehicles, on quantum computing and other emerging technologies.
Today in China, you see where the communist party is taking these emerging technologies. And how they get ahead is by stealing, by cheating, by subsidizing their own state owned enterprises. It’s the same playbook that they’ve used for a long time. But we’re seeing it even more clearly during this crisis. So for us to win the future, and to maintain our leadership, our global competitive advantage, our economic leadership, it’s going to happen through American ingenuity, American creativity, solving problems. And making sure that we are leading in all of these areas.
I would love to see a new era of innovation here in America that is leading with American values, American principles that respect human dignity, and the individual.
Rob Atkinson: We couldn’t agree more, and we’ve been saying that for a long time, that we’re not going to out compete, nor should we out compete China on things like Happy Meal toys or t-shirts. It’s really on the industries of the future, the advanced technology, and many of them in your home state. We have a new report coming out in a week and a half on how ... looking at how Chinese policies, particularly towards Huawei and their other telecom companies, ETE, have really damaged innovation in this industry. They helped really get rid of Lucent and Nortel, two North American leaders. They’re playing a role in limiting innovation in leading companies like Ericsson and Nokia. So I really, first of all, applaud everything that you’re doing there, can you say a little bit more about sort of how you would see this moving us forward so that we can stay in the lead?
Cathy McMorris Rodgers: Well you saw it in 2008 with the financial crisis, that’s when China used Huawei to get ahead. And right now we face a significant challenge when it comes to telecommunication infrastructure and the security issues around the 5G rollout and our effort to move to 5G. So we know how China operates. And they’re using this technology right now to spy on their own citizens, they use it to suppress minorities. And so I just believe that we need to be ushering in this era of innovation. And we’ll never outspend the Chinese, so they just announced that they’re doing 1.4 trillion dollars over the next five years investing in this emerging technology. But the American was has always been one that is focused on American ingenuity, American creativity, the freedom to take those ideas and to do something with those ideas. And we’ve always believed in a lighter touch on the regulatory front, that would allow someone to take that idea that they have and turn it into a million, a billion, or a trillion dollar company, it’s really unique to America.
America has been leading the world in technology and innovation over the last 50, 60 plus years, 70, 80 years. And it’s so important now that we lean in again with emerging tech.
So my goal is to make sure that entrepreneurs and innovators don’t have to ask the government for permission to innovate, that they can move forward. And this package of bills is really focused on identifying the barriers to the deployment and to the adoption of these next gen technologies. It’s not a silver bullet, but it is the beginning of really looking at how do we make sure that America leads.
Jackie Whisman: Can you talk a little bit about those regulatory barriers, if the committee has identified some so far?
Cathy McMorris Rodgers: That’s a big focus of this package, is to work on identifying the barriers. Maybe I’ll talk just about one issue in particular around autonomous vehicles. So right now there’s a big race as to who’s going to lead in the development, the deployment of driverless cars. And you see right now China is ... they’re testing cars on our roadways, and they’re collecting a lot of data that’s a part of that. And we have outdated regulations on the books that are making it difficult for our innovators to actually bring this new technology to the forefront. We have regulations on the books that require a steering wheel, or require airbags. And even though there is a little flexibility, we really need to be looking at a national standard so that it will allow our innovators to commercialize. The legislation is largely focused on identifying barriers and identifying how America is doing compared to other countries, and then we’ll be able to take action.
Rob Atkinson: One of the areas I think that’s important is autonomous systems overall. You eluded to cars and trucks, that’s a pretty important area where I agree, we have these regulatory barriers that the Chinese don’t have those barriers. But there’s a lot of areas, like for example a bunch of cities have actually banned autonomous delivery robots. So think about it in the age of COVID, where we’re in our home, it’d be a lot better to have pizzas and food delivered with a little teeny robot. But another one is really the Trump administration, Secretary Chao made what we thought a very important and good decision where the Obama administration had a rule that you needed to have two people in a train, even if it was perfectly safe and the technology allowed one in a freight train, and so they overruled that rule. And now if it’s proven to be safe you can have one person driving a train. And it seems to me that’s the kind of regulatory flexibility that should be based upon performance, not actual rules. If you can show that the driverless car is safe, let’s do it.
Cathy McMorris Rodgers: Right. Right, well, everyone, everyone absolutely wants to make sure that driverless cars are going to be safe, and I agree that if we can prove that it’s safe, then we should be moving forward. And the developers of these driverless cars have the most at stake. They absolutely recognize that if they’re not safe, then consumers, individuals aren’t going to feel confident in these cars. So we need to be developing standards so that we can move forward, and not allow someone else to be developing driverless cars, for example. Because that is our future. And you mentioned some cities just banning it, during coronavirus there’s been several examples where driverless cars have been used to deliver important medications, or food to people that are in need that may be isolated and not able to get out of their homes, or out of their apartments. So this is another time when we can celebrate what this technology is providing as far as a safe and effective way to meet peoples’ needs. And there’s going to be so many more examples like that.
Rob Atkinson: I saw a video the other day about ... I forget the company, but they were using drones to deliver medical supplies. And again, an area where we should be a little farther ahead in drones, but we’ve lagged on some of the regulation. It’s gotten a little better, I think your package of bills also addresses that, does it not?
Cathy McMorris Rodgers: Absolutely. I think in general, America has led because we believe in the light touch regulatory approach. We believe in free markets, we believe in people being able to take their ideas and do something, and we’ve seen so many examples of that during the coronavirus. It is going to be American ingenuity and innovation that’s going to help us through the coronavirus and beyond. So that’s why I think it is so important that we are doing this in an American way, that we’re showing the rest of the world how to develop these technologies and do it in a way that is the American way. That’s the challenge and the opportunity ahead of us.
Jackie Whisman: The committee’s taking up a whopping 15 bills as part of this package, which we can link to in the show notes, we don’t have to get into every single one. But I do want to get to generating artificial intelligence networking security, or the GAINS Act, where you are the lead. Can you talk about what this bill would do?
Cathy McMorris Rodgers: Right. So really excited about the package. The GAINS Act is legislation that I’m taking the lead on. Different members on the subcommittee are taking the lead on different aspects. But the GAINS Act is really focused on artificial intelligence, and to make sure that we’re identifying adoption barriers. It includes a report on the development, the deployment. It also would ask us to look at how do we rank around the world, how are we doing with other leading countries on the development and the deployment of AI? Including China. And it will allow us to look at some of the vulnerabilities in the AI supply chain, and make some recommendations on how to address those risks. Because the coronavirus has only underscored the importance of us looking at supply chains also, that we have become dependent and vulnerable because we haven’t been as smart and strategic as we need to be on the supply chains.
But I would also just highlight that the package includes issues like quantum computing, blockchain, the Internet of Things, 3D printing. In all of these areas we need to be looking at what are the barriers and the opportunities for further adoption and deployment.
Rob Atkinson: I think you couldn’t have picked a better time to really focus policymaker’s attention on this. We file a lot with the European commission, they’re constantly ... regularly, I should say, asking for input on some of their advanced technology issues, and one of the filings we’re doing on Monday is around artificial intelligence, where they’re actually going to be requiring that most or many AI algorithms have to get preapproval before they can be used in Europe. And this is not the innovation principle that Americans adopt, this was the precautionary principle, so I commend you for making sure that we understand that’s why we’ve had the lead. We don’t have to go and get permission from the government to be able to deploy an AI algorithm, we just have to make sure it obeys the law if you’re using it in health, or if you’re using it in security. But we don’t have an AI specific rule. Just like your bill on cars, you’re not regulating the algorithm, you’re regulating the car, is it safe.
Cathy McMorris Rodgers: That’s a very important point, and that goes to the American way. And that’s why I think American leadership is so important as it relates to emerging tech. And not just saying no. The examples where there’s a knee jerk reaction to just say not to his emerging technology is not going to serve us well, and it’s going to mean that China continues to lead, and other countries.
But as I mentioned earlier, the way that China’s using this emerging technology, it stifles free speech, and minorities, and it is not the American way. And so that’s where it’s so important that we are addressing these really tough issues, but doing it in a way that respects individual rights, that allows for the freedom to go explore and see what’s possible. There is huge opportunities, you look at artificial intelligence and what it can mean to us in the future as far as curing cancers, and further prescription drug development, precision agriculture, manufacturing, every industry is going to be revolutionized by artificial intelligence. And the question that we have as policymakers is whether or not ... or, I guess how we’re going to regulate it, but do it in a way that does not hold back innovation. And that is going to allow us the benefits of artificial intelligence that will continue to raise the standard of living and save lives that’s been the American way.
And we can’t allow an overly cautious approach, like the EU, or so restrictive where it’s government controlled by the Chinese through their communist party. That is not the American way. And I just would encourage people to think about the fact that America has been leading the world in technology and innovation over the last 50, 60 plus years, 70, 80 years. And it’s so important now that we lean in again with emerging tech.
Rob Atkinson: Here, here. We’ve always had the view that the future is going to be better than the present, and that technology is something we embrace, not fear, and so 100% agree.
Jackie Whisman: Congresswoman, you’re at the top of the shortlist to become chair of the Energy and Commerce Committee if the majority changes hands next Congress. What does an E&C agenda look like under Chair McMorris Rodgers?
Cathy McMorris Rodgers: Well, thank you for that question, I’m really excited about the opportunity to lead the House Energy and Commerce Committee for the Republicans, chair the House Energy and Commerce Committee when the Republicans take the majority. But my goal is to make sure that America is leading, that we continue to be the economic leader, but also around all of these issues I believe American leadership is so important. My goal as a chairman of the committee is to really focus on making sure that every member is involved. You look at the package of bills that I introduced around emerging technology, every member of the subcommittee is taking the lead on one part of those bills. Within the Energy and Commerce Committee right now you have issues around technology, emerging tech, healthcare, where are we headed on healthcare? The energy, all of these issues are defining America’s future, America’s leadership in the world. And no one person can take on all of those issues, so I really believe in making sure that members bring their passion, their expertise to the forefront and are allowed to lead.
My goal is to make sure that we are ready on day one. That we know where we want to go, and one thing about being in leadership for the last six years, I served as chair of the conference, three years with Speaker Paul Ryan and three years with Speaker John Boehner, I have an understanding as to that it takes to get big things done. And to work with the Democrats, work with bipartisan members, understand all the different factions within our conference, but also what it takes to work to get a big bill through the House and through the Senate and signed into law.
But at the heart of this is American leadership. And to make sure that America is leading in the emerging tech, leading in healthcare. I’d love to see 21st century cures 2.0 where America continues to lead in curing diseases and breakthroughs. On energy, American energy has been a competitive advantage to us. And we are leading again in this transition to a clean energy future. American leadership and American competitiveness is really at the heart of the Energy and Commerce Committee, and that’s going to be my goal in leading this committee.
Rob Atkinson: One of the nice things about E&C is that compared to some other committees, it tends to be more bipartisan because these issues just are more bipartisan. Both sides of the aisle really care about clean energy, they care about a better telecom system, better heath, better commercial competitiveness through technology, so it’s a great place to really start to move the country in the right direction.
Cathy McMorris Rodgers: I completely agree with that, and all of these issues right now are the issues that are on the forefront of peoples’ minds. And as you think about where we find ourselves, and the competition with China in particular, and it’s being exposed that China’s goal is to be the economic leader. They have this 100 year plan, and China has the luxury of looking 10, 20, 50 years down the road, right, they don’t just legislate crisis to crisis. They have this plan for global dominance. So I think it’s more important today than ever that it is Republicans and Democrats coming together to make sure that America is leading. And that this committee is really at the center of healthcare, energy, technology, telecommunications. And we need to make sure that we’re working to position America for the future.
Jackie Whisman: One last quick question if you’ve got a second. What is the technology you’re most excited about right now?
Cathy McMorris Rodgers: Well, there’s a lot to be excited about. I’m always inspired by the innovators, the people that I get to meet that have ideas as to what’s possible. And that’s been the American way. As I think about the coronavirus, I hope that one of the things coming out of this time of isolation and lockdown is that we can come out with a commitment for a new era of innovation. And we’ve talked about so many different technologies even today. I reflected on artificial intelligence, it is one that’s going to revolutionize every industry. And we can be excited about what it can offer, the way that it can help in healthcare, in cancer screenings, in drug development. I come from an area in eastern Washington that where agriculture is the number one industry. I have farmers that are on the edge of precision agriculture, and being smarter about the application of fertilizer, and water, and how to do that in a way that is even going to be more effective for the crop development and maximizing our outcomes.
And there’s so many examples, and I think the potential is great. We just need to make sure that we are committed to leaning in to these emerging technologies. And do it in a way that protects peoples’ privacy, that ensures that America is leading, and we certainly can’t afford to step back right now, we need to lean in.
Rob Atkinson: Again, couldn’t agree more. I ran across a company a while back in Silicon Valley, you mentioned eastern Washington with agriculture, this is a company, it’s a venture backed company, they’re growing now even in the economic crisis, called Farmer’s Business Network. And they have partnerships with farmers all around North America. They collect the data, they run AI analytics on it, they give them back useful information to be able to become more effective and productive farmers. That’s such a fantastic model in the US, we’ve done that, the Europeans are trying to figure out a government program to be able to make that to happen and yet here we already have it.
Cathy McMorris Rodgers: Yes, I started out 2020 with this mantra that the best way to predict the future is to invent it. Because we started the year with lots of questions about what’s going to happen? And I feel that it’s even more important today, it’s only been underscored after this pandemic, that as Americans we can embrace that the best way to predict the future is to invent it. And I’ve added on to that that we need to have the courage to dream again. America has always been the country where we believed in the American Dream. And dreaming is about creating. We don’t talk about the French Dream, or the Australian Dream, or the Chinese Dream, we talk about the American Dream. And this is just a time that we need to keep that going.
Rob Atkinson: Absolutely. Thank you so much for being with us, it’s been a real pleasure, and good luck as you go forward with this package of bills.
Cathy McMorris Rodgers: Super, good to be with all of you.
Jackie Whisman: And that’s it for this week. If you liked it, please be sure to rate us and subscribe. Feel free to email show ideas or questions to [email protected]. You can find the show notes and sign up for our weekly email newsletter on our website, which is ITIF.org. And follow us on Twitter, Facebook, and LinkedIn @ITIFdc.
Rob Atkinson: That’s it for now. But we have more episodes with great guests lined up, including on how to transform government with IT. New episodes will drop every Monday morning, so we hope you’ll tune in next week.