The incoming administration of President-elect Bill Clinton is committed to an information technology policy that mixes market forces with interventionism and networking has been singled out for particular attention. Earlier this year, Vice-President-elect Al Gore presented an information technology infrastructure bill that proposed a nationwide high speed data network: the National Data Superhighway. The proposal died in July before a House of Representatives committee. Clinton is committed to revive the scheme which should get broad Congressional support this time around. The plan promises lucrative contracts, similar to those handed out for the National Research and Education Network, only on a much larger scale. That is not the only expenditure promise, however – the National Institute of Science and Technology will get its funding doubled. Much of this expenditure is expected to come from a rebalancing between civilian and military research budgets. A Clinton economic advisor explained just before the election that current split of around 60:40 in favour of the military would be evened out, resulting in a shift of about $7,000m over three years towards civilian research and development. Though these proposals are basic variants on the pump-priming theme, they are backed by rather more innovative legislative changes. In particular Clinton has pledged to remove a series of regulations that prevent industry from directly advising the administration. While the laws were originally designed to maintain a healthy distance between big business and the administration, the Clinton aide said that the result had been a dearth of informed information reaching policy makers.
Hit-and-miss
The changes in absolute amount spent on civilian research will be supplemented by controls on how it is spent. Clinton to promote the formation of industry lead consortia and 10% to 20% of the national laboratories’ (such as Lawrence Livermore) budgets will be earmarked to these joint ventures. Those who remember the UK Alvey programme, or the doings of the US Sematech consortium recognise how hit-or-miss these ventures can be. European manufacturers should hope that the General Agreement on Tariffs & Trade talks proceed apace. One company that will be wary of the new government is AT&T Co. Brown Brothers Harriman analyst Robert Wilkes downgraded his rating on AT&T shares to neutral from hold following the election result. The reason? He believes the new executive will be significantly tougher on AT&T than the previous one. I would consider the outgoing administration to have been relatively benign to AT&T, he commented: there may be more of an effort to be aggressive on pricing. A price cap review is currently before the Federal Communications Commission.
