Innovation Power for the Generative AI Flywheel: A Summary
Hello, I’m Ylli Bajraktari, CEO of the Special Competitive Studies Project. In this edition of 2-2-2, SCSP’s Nyah Stewart, Associate Director for Future Technology Platforms, provides an overview of the Platforms’ chapter of SCSP’s recent report, Generative AI: The Future of Innovation Power. The link to the full Memo to the President and Congress on Innovation Power for the Generative AI Flywheel can be found here.
Generative AI: The Future of Innovation Power Featured on SCSP’s NatSec Tech
Members of the SCSP team join Jeanne Meserve to summarize each memo from our fall report, “Generative AI: The Future of Innovation Power.”
Subscribe to 2-2-2 for five more episodes in the upcoming weeks.
In this first episode, SCSP’s Abigail Kukura and Nyah Stewart summarize Memo to the President and Congress on Innovation Power for the Generative AI Flywheel.
We are in the midst of a revolutionary moment. Generative artificial intelligence (GenAI) is starting to converge with other scientific and technological fields across the digital, physical, and biotechnical domains. This coalescence of technologies will fundamentally alter how countries around the world innovate and create a new form of power that changes the nature of national security—innovation power. The nation that best harnesses the step-changing potential of generative AI to invent, adopt, and adapt new technologies at an unrivaled speed, quality, and scale is unlikely to be caught. In the context of a global technological competition with the People’s Republic of China (PRC), the United States cannot leave long-term leadership in generative AI to chance.
The United States has an edge in generative AI today, with many U.S. tech companies like OpenAI leading the field. Yet this is a technology competition that will unfold over decades and, as the PRC bolsters its technological competitiveness, GenAI leadership will be increasingly contested. Even with smaller capital markets and a reliance on U.S. hardware and software, the PRC has quickly taken a forward-leaning stance on deploying GenAI regulations and driving academic R&D to further GenAI applications. As China’s generative AI models like Baidu's Ernie and Huawei's Pangu model enter public domestic use, it is clear that the PRC aims to harness this technology and deploy GenAI across various sectors. U.S. allies and partners, such as the United Kingdom, are navigating how to best utilize artificial intelligence to bolster their own technological competitiveness. Stakeholders across the U.S. innovation ecosystem — from startup founders to Members of Congress, as evidenced by Senate Majority Leader Schumer's AI Insight Forums — have similarly recognized the need to reprioritize and adapt to today's GenAI moment. However, today is just the beginning.
The Generative AI Flywheel
In action, the Generative AI "flywheel" spins out innovation that begets more innovation. As a natural language interface, an orchestrator, and simultaneously an inventor, GenAI has already begun to unlock technological innovations that were previously seen as impossible. For example, generative AI models have predicted the structure of unknown proteins, leading to novel drug discoveries. AI has helped control a nuclear fusion reaction within a tokamak, bringing us closer to the ability to recreate the power of the Sun on Earth. GenAI is also being used to identify new materials, with the potential to transform our physical world. In parallel, Generative AI is starting to drive advancements within its own technical underpinnings, from computing paradigms and hardware to algorithms and data, setting us on the path to an even more general form of artificial intelligence. The GenAI flywheel is indeed already turning.
Eight National Moves to Meet the GenAI Moment
So how can the United States solidify its current lead and steer the GenAI flywheel towards long-term U.S. innovation power? The Memo to the President and Congress on Innovation Power for the Generative AI Flywheel asserts that the United States will be well-positioned to lead the GenAI era if the U.S. government organizes, drives, and fuels its innovation ecosystem.
First, the federal government must organize the innovation ecosystem to execute cross-cutting audacious technology goals. The U.S. government should establish an institutional home for a national technology strategy process to provide long-term intellectual continuity between administrations and empower policymakers to "get smart" on emerging technologies to inform policies, adoption, and widespread governance. The United States can also tap into the latent potential of the national laboratory system through a reimagined model of public-private partnerships that connects the innovation ecosystem's basic research and problem-solving corners. Organizing in these ways would enable the nation to launch and land audacious “moonshots” to drive GenAI-enabled innovation. Targets could include building an S&T Platform for innovation advantage or operationalizing a National Medical Shield that protects the nation from any pathogen-like threat.
Yet charting a new course toward the Endless Frontier will not be possible without fuel. Government support for research and development (R&D) is crucial as we enter a new period of accelerated technological progress. Today's GenAI moment presents an opportunity to get the lifeblood of innovation—federal R&D spending—back on track. While the CHIPS and Science Act made historic investments into bolstering the U.S. innovation ecosystem, current appropriations fall below what the CHIPS Act envisioned for key federal R&D agencies, like the National Science Foundation. Therefore, the federal government should fully fund the "Science" in the CHIPS and Science Act so research discoveries can move from the lab bench into practical applications.
Since GenAI has the catalytic potential to accelerate innovation itself, the federal government must also continue to expand its investments into technology more broadly.
To start, the federal government should consider methods to fund the R&D spending target outlined in the President's 2024 Budget Request and, in the longer term, aim for federal R&D funding to equal one percent of the total U.S. GDP by 2026. Increased investments will bolster the United States' R&D intensity and mirror the levels of government spending that jump-started American innovation and landed the Apollo Program on the moon. Expanded federal investments in artificial intelligence and other strategic technology sectors would spur not only innovation, but also catalyze broader economic growth.
Increased federal funding could be quickly allocated across the innovation ecosystem through a GenAI-enabled rapid grant program, and federal investments could be sustained through an annual technology fund modeled after the DoD's "Overseas Contingency Operations" funding vehicle.
Increased, faster, and committed federal R&D spending is the necessary spark for the nation's innovation power, enabling the capacity to audaciously invent, fully adopt, and quickly adapt new technologies.
The federal government must now take the chance to set the nation on the path to lead the GenAI era. The GenAI flywheel has started to turn, but steering it toward national competitiveness requires strengthening the U.S. innovation ecosystem through better coordination, goal-setting, and investment. With generative AI's revolutionizing potential and the era of innovation power taking hold, the United States cannot let this moment go to waste.
Read more about innovation power, the Generative AI flywheel, and the eight moves the U.S. government should take to meet the current moment here.