A New "Technology Gap" in Europe?

A NEW "TECHNOLOGY GAP" IN EUROPE? Bruce L.R. Smith EEUROPE IS IN THE MIDST OF A POTENTIALLY FAR-REACHING EFFORT to launch new cooperative technological ventures, break down remaining barriers to freer internal trade, and reform nationalistic procurement practices. The stimulus has been the fear of being caught between the technological superpowers—the United States andJapan—and of falling behind in the transition to a new world economy based on rapidlydeveloping information technologies. The American Strategic Defense Initiative (sdi) plays a key role in the drama even though prominent European observers insist that technological cooperation is "a necessity— with or without sdi."1 The reason that Europe must cooperate is because "no country can on its own keep up with developments in high technology in the United States and Japan. Only the European democracies in their entirety have the researchers and engineers, the wealth of companies both large and small, the capital, and above all, the market to be competitive in the new technologies."2 This may sound familiar. Europe has struggled with the problem of a "technology gap" before. The 1960s 1.Speech by Hans-Dietrich Genscher, minister of foreign affairs of the Federal Republic of Germany, at the Eureka meeting in Paris, July 1985, reproduced in Statements and Speeches, Federal Republic of Germany, 3:22, 19 July 1985, 1. 2.Genscher, 1. Bruce L.R. Smith is on the senior staff at the Center for Public Policy Education, The Brookings Institution, and is a professorial lecturer at The Johns Hopkins School of Advanced International Studies. 219 220 SAIS REVIEW was a decade of experimentation in European technological cooperation designed, in part, to counter "the American colossus."3 This essay will explore the new "technology gap" in Europe against the background of earlier events. The aim is to show how the present response differs from that of the 1960s, to describe and analyze some of the recent initiatives, and to suggest some possible outcomes for Europe, Japan, and the United States. In 1967Jean-Jacques Servan-Schreiber published The American Challenge , calling on his countrymen and the rest of Europe to face the technological challenge posed by America. The book reflected widespread European fears of technological and industrial domination by the United States. Servan-Schreiber warned: "America today still resembles Europe—with a 15-year head start: She belongs to the same industrial society. But in 1980 the United States will have entered another world, and if we fail to catch up, the Americans will have a monopoly on know-how, science, and power."4 He postulated that innovation in industry was a function of the number of scientists and engineers in the work force. The higher the percentage of research and development (R and D) workers on a company's payroll, the more innovative (and profitable) that company would likely be. Generalized to include the whole economy, a greater reliance on scientists and engineers in a nation's commercial enterprises would mean a more vigorous pace of innovative activity and brisk economic growth. This would not be determined by technology alone; other important factors included the educational system as a whole and the nation's human resources, the ability to manage complex endeavors, and the cultural willingness to embrace change. These factors generate a mind-set that encourages new ideas, experimentation, and state-of-theart leaps in productivity. Servan-Schreiber's view of technology included everything from basic research to product development to management and marketing, and it ultimately embraced an almost mystical faith in the creative energies of the human spirit. There were many ambiguities and ironies in Servan-Schreiber's conception. Attentive observers on both sides of the Atlantic found much to admire and puzzle over in his book. Before the decade was over, some Americans began to repeat similar arguments vis-à-vis the challenge posed by the Japanese and by leading European firms. In one wellknown article it was asserted that we Americans were "managing our way to economic decline."5 Too many lawyers, financial management experts, 3.The term is Jean-Jacques Servan-Schreiber's in The American Challenge, (New York: Atheneum, 1968), chap. 5, (Le Défi Américain was published originally in...