Electronic Design

Technology Has Been Very Good To Obama, And He Plans To Reciprocate

President-elect Barack Obama likes technology.

All you have to do is look at how effectively and creatively he used the Internet in his election campaign, as well as at how often you saw him on TV and in news photos working his BlackBerry. The iPhone application he released about a month before the election allowed users to stay on top of campaign news and get mapping information to local campaign events. His Facebook application at last count had more than 160,000 active users.

His transition advisors are already well into developing what they call Obama 2.0, which will transform the new president’s vast Web operation and database of supporters into a tool that will help promote his agenda by going directly to the public, skipping right over pundits and the more traditional press and media.

For security reasons, Obama is going to have to stop sending e-mails after he moves into the White House. But he has already told aides he wants a laptop computer on his desk in the Oval Office, the first American president to do so.

He also introduced the Mercury Export Ban in the U.S. Senate, already signed into law by President Bush, which prevents companies from sending mercury-tainted trash, much of it e-waste, to the developing world.

Reaching the Public

Obama built a list of more than 10 million supporters during his election campaign, including 3.1 million contributors. The Web site change.gov has been designed to enable anyone to post messages, including suggestions for the new administration, or to apply for a government job. It also invites visitors to add their names and e-mail addresses to the site to help create a new list, which Obama and his team will use to directly bypass, if they want, the news media in communicating messages to the public. Because of legal and other restraints, it will operate separately from the White House. And, he plans to rework the White House Web site to make it more interactive and user-friendly.

Obama has already told the American people that the United States must compete more effectively against international competition pressing the U.S. with a growing investment in technology. To back that up, he has pledged to appoint the nation’s first chief technology officer (CTO), who could potentially have a major influence over the new president’s policies on many fronts and across several federal agencies, as well as helping to stimulate innovation in the economy.

In his second book, The Audacity of Hope: Thoughts of Reclaiming the American Dream, Obama wrote, “If we want an innovation economy, one that generates more Googles each year \[Obama apparently came away impressed from his visit to Google headquarters in California during his election campaign\], then we have to invest in our future innovators—by doubling federal funding of basic research over the next five years, or providing new research grants to the most outstanding early-career researchers in the country.”

Several industry trade groups, including the Consumer Electronics Association (CEA), the National Association of Broadcasters (NAB), and the CTIA – The Wireless Association, were quick to publicly congratulate Obama for his election victory. CEA President Gary Shapiro says Obama ran an “innovative digital campaign” that embraced technology “in creating opportunity, growing our economy, and creating jobs.”

But facing a global financial crisis, Obama may have to perform a reality check before signing any checks, and that includes Pentagon spending.

Tightening the Belt

With the Pentagon’s annual base budget already at its highest level since World War II, paying for national security is going to be one of Obama’s biggest challenges. The most expensive military programs may be the first to be chopped. Congress has already approved about $4 billion less than the Bush White House requested for defense.

On the legislative front, the U.S. Senate has passed and President Bush has signed the America Competes Act into law. It would double the budgets at the National Science Foundation, the Department of Energy’s Office of Science, and the National Institutes of Standards and Technology (NIST), establish the Advanced Research Projects Agency for Energy at the Energy Department, and strengthen engineering educational opportunities at U.S. schools at all levels.

But Congress has not yet financed these programs, which are projected to cost about $43 billion for the first three years. The government tends to finance basic research programs that have greater breakthrough potential. Yet a recent study by PricewaterhouseCoopers suggests the fastest growth in tech growth will come in emerging markets, an area where the U.S. has been lagging behind other developed countries.

While the government currently only subsidizes phone service in rural areas, Obama also favors giving government subsidies to Internet service providers who build networks in these low-population areas. On a larger scale, Senator Byron Dorgan, a North Dakota Democrat, already said he plans to introduce a bill in January that would bar Internet service providers (ISPs) from blocking Web content, setting the stage for a renewed battle over so-called network neutrality, which pits ISPs like AT&T, Verizon, and Comcast against content companies like Google and Microsoft.

The ISPs believe they have to maintain control over their ever-growing traffic without government interference, while the content specialists say the ISPs already have too much power over network traffic and applications, such as movie downloads.

Will Obama replace the current chairman of the chairman of the Federal Communications Commission (FCC), Republican Kevin Martin? It’s hard even to guess, but this might take time, just as it may take him months to get around to naming the nation’s CTO.

A self-confessed space buff, Obama said during his campaign that he supports a robust program of robotic probes and space-based telescopes and satellites. But NASA has budget problems that won’t be easy to fix. In addition to being forced to downsize and possibly delay some of its biggest programs, it is talking about outsourcing some of its programs.

What about jobs? High-tech companies are announcing layoffs almost daily, and some economists suggest Obama won’t be able to have much of an impact on improving the job situation during his first year in office—in any industry sector. Politically, this is also not a good time for Obama to ask Congress to increase the number of H-1B visas for skilled foreign engineers, now authorized at 65,000—even though he’s on record as favoring an increase in H-1B visas until there is a comprehensive new policy on immigration. IEEE-USA, the Washington, D.C.-based lobbying arm for the IEEE, doesn’t anticipate any increase in H-1B visas in 2009.

In the meantime, industry trade groups would like to see more oversight of the H-1B program. A recent study by the U.S. Citizenship & Immigration Services found that 13% of the requests for H-1B visas were fraudulent and 7% had technical violations, including H-1B applications that didn’t have academic credentials or experience on applications. Fixing that may be one of the new administration’s early challenges.

Trade is another major issue the Obama administration will face. The electronics industry’s primary goal is to gain better access to foreign markets and eliminate non-tariff trade barriers. But the new president will also be under some pressure to uphold and enforce trade agreements, especially with countries that keep their export prices artificially low with unfair subsidies.

In mid-September, 14 technology trade groups, including the Semiconductor Industry Association and the CEA, sent an open letter to President Bush and Congressional leaders urging quick passage on free-trade legislation with South Korea, Columbia, and Panama. The U.S. International Trade Commission (ITC) is updating its report on U.S. import restraints, focusing on U.S. trade liberalization, which is scheduled to be submitted to the U.S. Trade Representative by August 2009.

Meanwhile, the World Trade Organization (WTO) has launched an investigation into European taxes on imports of high-tech goods, following complains from the U.S., Japan, and Taiwan. The WTO set up an investigative panel to examine the legality of European tariffs on flat-screen computer monitors, cable and satellite boxes that can access the Internet, and printers that can scan, fax, and copy. According to the Information Technology Industry Council, duties that can run as high as 14% make U.S. exports less competitive in the European Union.

The U.S. consumer electronics sector alone indirectly impacts one-tenth of U.S. GDP and supports 15.4 million American jobs in related industries. Spurred by international trade, consumer electronics is projected to generate $1.4 trillion in direct business activity this year. Trade plays a critical role in the industry’s health with one in seven of those jobs, or about 616,000 jobs, directly tied to America’s trade overseas.

Then there’s the national deficit, which climbed to a record $237.2 billion in the first month of fiscal 2009, compared with $56.8 billion in October in 2007. What’s a president to do? With economists and analysts already predicting that the economy might be even weaker in 2009, they expect the Obama administration will need to spend more, pushing the deficit up even further.

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