Wake Up, America: China Is Overtaking the United States in Innovation Capacity

Helped in huge part by their loose attitude towards intellectual property restrictions. Look at how much innovation occurred in FDM 3D printers after the patents expired. Before then, printers cost $25k and they shipped less than 1k per year. Ten years after the patents expired and they were available for as low as $250 and shipping in the many thousands of units per months.<p>Just imaging the compounding effects on growth if all of your high cost items dropped in price by 100x, with way more options available to choose from and cheap parts available with two day shipping. Think of how much easier it is to learn mechanical engineering and build prototypes thanks to 3D printers. And then consider that when 3D printers were first invented both IBM and Stratasys had patents - meaning the ideas were understood by multiple parties and would likely have been created without patent protection.<p>IP restrictions slow down innovation like molasses.

Slight caveat, the ITIF is an industry lobbying group for enterprise companies like IBM, Cisco, Google Cloud, Microsoft, Intel, and Amazon. I am a big supporter for investing in R&amp;D as a nation (I totally stan Vannevar Bush), but this is just one of the various anti-trust submarine pieces that are starting to coming out.<p>This clip from &quot;The Thick of It&quot; sums up think tanks on the Hill and Westminister - <a href="https:&#x2F;&#x2F;m.youtube.com&#x2F;watch?v=lADB9Qu53CY">https:&#x2F;&#x2F;m.youtube.com&#x2F;watch?v=lADB9Qu53CY</a>

&gt;The last decade was marked by dramatic evolution in China’s innovation capabilities and strategies, much of which was driven by the transition of Chinese Communist Party (CCP) and state leadership from Hu Jintao and Xi Jinping and the introduction of China’s latest major innovation policy framework: Made in China 2025 (MIC).<p>Reads like a lot of things from Chinese state media these days, which seem obliged to always lead with kudos to Xi.<p>But to the point, of course China has tons of smart people, and has the raw capacity to innovate all day long. What really stands in the way is the extreme risk aversion that exists at all levels. Management is is extremely risk averse and so is the party. No “innovation policy framework” will change that.

Capacity != Capability

It&#x27;s a lot easier to copy something than to build something new.<p>Without the freedom to fail and the freedom to challenge the existing socio-economic status quo, China will have trouble out innovating the USA.<p>The best and most valuable innovations generate creative destruction. Change in China is top down not innovation driven.