Recently, I sent the "Washington Update" immediately below to the AeA Board of Directors to start a dialogue; and now I wish to solicit comments from the full 2,500 companies that make up the association’s membership.

Washington Update
First, I want to give you a status report on what’s happening on the competitiveness initiative here in Washington pursuant to our Board meeting in June.  Secondly, I want to talk to you about a structural problem, if you will, in dealing with high-tech issues in the Congress.

Per competitiveness, I would like to break this down into the three groups of the AeA initiative. They are:

• R&D Funding
• Math and Science Education Programs
• Visa Reform

R&D Funding
Representative Frank Wolf (R-VA), the Appropriations Subcommittee Chairman for Science, addressed the Board at our June meeting.  He said that he was intent on getting passed out of his subcommittee $6 billion in R&D funding, particularly for the physical sciences and in the National Science Foundation (NSF) budget.  Well, he delivered.  NSF received a $6 billion appropriation which was the amount requested by the President in his American Competitiveness Initiative (ACI).  The amount is an increase of $439 million above fiscal year ’06 or an increase of about seven percent, which is what AeA favored.  The $6 billion includes $4.6 billion for research and $335 million for science education, which was $16.2 million above the request of the White House.  The appropriations bill, which includes NSF, has been approved by the full House. It awaits action in the Senate.

The Senate began action on July 11 regarding R&D.  Senator Richard Shelby’s (R-AL) subcommittee on science passed the NSF budget at the level of $5.99 billion.  Even in Washington that’s considered $6 billion.  It is also $410 million over what the Senate subcommittee voted on the previous year.  This is a breakthrough.  We met with Shelby’s staff a few months ago and the NSF budget was a big question mark.  There seemed to be considerable opposition to an increase in the NSF budget for R&D.  Well, it happened and now it goes to the full appropriations committee and then to the full Senate.

Math and Science Education Programs
Currently in neither House is there an authorization bill that in fact will authorize some new initiatives for math and science education.  Interestingly, on July 11^th I was on a panel with Senator Lamar Alexander (R-TN) who noted that there are now 70 co-sponsors of a Senate math and science education initiative.  He made an interesting comment that with 70 co-sponsors, the strong support of the White House, and the fact that there appears to be a genuine consensus that we have to do something about math and science, there is still no appropriation to fund these initiatives.  So no authorization yet, no appropriation yet.  But we agree with Senator Alexander that it is going to happen.  The magnitude of the programs is still to be decided.  But we are confident it will happen.

Visa Reform
To some degree the efforts on visa reform are in abeyance.  This is because we are letting all the Sturm und Drang about illegal immigration to play itself out.  We do not expect an immigration bill which will likely include visa reform to be taken up until the lame duck session in November.  I would note to you that there has been some recent hesitancy on the part of some Republicans as a result of the backlash from the Hispanic community to the hard line Republican approach.  I would also note that the President seems to have at least changed his rhetoric and has put more emphasis on protecting the borders and a lot of discussion by both the House and White House about the use of “triggers.”  What the triggers will do is establish certain milestones for sealing the border, particularly with Mexico, and when those milestones are achieved put into affect the process for legalizing illegal immigrants already in the U.S.  Obviously, that is going to be a lengthy process.  But the process will likely hinge upon what happens with the border enforcement activities.

We remain confident that visa reform will take place and will be included in an immigration bill.  If an immigration bill is delayed because of the politics, we think we can find another vehicle, probably an appropriations bill, to attach the visa reform issues.

Summary
AeA has met with a number of congressional staffers and members on all of these issues.  We also met with Karl Rove, John Marburger, the President’s Science Advisor, and other senior White House officials, on these issues.  The White House has been quite visible in communicating to the Congress the importance of the President’s American Competitiveness Initiative (ACI).

One caution—we remain very concerned that the Congress will pass legislation and appropriations on the above issues and basically pat themselves on the back and say “see, we solved the problem of competitiveness.”  That’s what we want to avoid as does the White House.  Namely, dealing with American competitiveness is a long-term issue and not a one-year simple answer.  So no matter what happens this year we have got to carry this issue over for several years to come and convince the Congress that you don’t solve the problem in one session of the Congress.

High Tech and Congress
I would like to raise another issue.  And that is the increasing problem we are having in lobbying high-tech issues because most members of the Congress just don’t understand them.  This phenomenon was really brought home recently when I was interviewed by a reporter from a prominent national newspaper.  He noted that there were a lot of high-tech issues being discussed over the last six months in the Congress but few of those issues would end up being resolved in some form of legislation or policy pronouncement.  He thought that part of the reason for this is a certain hesitancy that he has observed on the part of members of the Congress when a high-tech issue comes up.  He thought that the hesitancy is a function of members of Congress knowing that they don’t know the issue and are worried about the unintended consequences of certain legislative proposals.  He said he has seen this in the telecommunications act being considered, digital rights management, privacy, data security, and he particularly saw it on the issue of net neutrality.  Indeed, he noted that there was a vote of the relevant Senate subcommittee of 11 to 11 for and against real net neutrality.  He commented “more than half of the members who voted for or against had no idea of what they were voting on.  They just don’t understand it.

I mention all of this because we at AeA have seen this coming.  We have come to conclude that before you can lobby a member of Congress you have to educate them much more thoroughly.  This is the reason that our research group’s focus is on four-page tutorials such as on visa reform, RFID, China economic relations, and several others.  They are written for the layman.  We are finding that numerous Hill staffers are using our research stuff to brief their member about these issues and be able to do it in private without the member being embarrassed by what he doesn’t know.

But there really is also a generational issue here.  Many of the most senior members of Congress or near senior members are not sophisticated about technology or technology trends.  They just don’t get it.  We at AeA and the industry have to do more to get some members up to speed.  Failure to do so will indeed result in high-tech legislation passing that has profound unintended consequences.  We cannot wait until a younger generation—which is technologically hip and computer sophisticated—become members of Congress.  I therefore solicit your thoughts on how we can indeed do a better job of informing our elected officials, and not just at the Federal level.  Technology to some degree scares them.  But they also don’t want to admit publicly that fact or that they don’t understand it.

AeA has been ahead of the curve on understanding this and our four-page tutorials have been a significant medium for dealing with this issue.  But any suggestions that you have to go beyond this I would certainly like to hear.

Best regards,
William T. Archey (bio)
President and CEO, AeA