Unleashing the Second American Century by Joel Kurtzman

Author:Joel Kurtzman [Kurtzman, Joel]
Language: eng
Format: epub
ISBN: 9781610393102
Publisher: PublicAffairs

We met in Milpitas, California, at KLA-Tencor, one of those Silicon Valley manufacturing powerhouses you never hear about. But there it was on a campus of its own with several large industrial buildings surrounded by a huge expanse of lush green lawn. The grounds included a gourmet cafeteria and a well-maintained set of volleyball courts. (Engineers need to let off steam every once in a while.) At lunchtime, the volleyball courts were fully occupied, and every seat in the cafeteria was filled. Just glancing around at the technical staff munching sushi and drinking green tea gave me a nice intuitive affirmation that America’s technical leadership draws from the best of the best. I could see that this was a diverse group of people whose origins were from everywhere on earth. Race, gender, and family history mattered for naught in this crowd.

I mention the name of KLA-Tencor simply because it provided the space where we met, but there are many such companies. KLA-Tencor makes testing equipment that is used to ensure that the semiconductors we use in our computers, tablets, mobile devices, and almost every other kind of device are made right and work properly. Although the United States accounts for only 4 percent of the world’s population, American companies make a third of the world’s semiconductors—another indicator that the United States remains an economic and technological superpower. But more importantly, American companies are dominant at the top end of the market. For example, in July 2013, when China said it had built the world’s fastest computer, it also said (perhaps under its breath?) that the brains inside the box were semiconductors made by California’s Intel Corporation. And when IBM built the Watson supercomputer, which defeated Brad Rutter and Ken Jennings in the televised game show Jeopardy, this veritable rain man of a computer was powered by IBM’s Power7 chips, which were developed under a grant from DARPA. It was against this high-tech backdrop of Silicon Valley that I gave my talk about the world’s economic predicament.

After finishing my talk, the CFOs and I began a discussion and exchange of ideas. I wanted to get a better understanding of their most pressing issues and listen to what was keeping them up at night so that I could offer solace and solutions. To speak to this group, I had to sign a nondisclosure agreement that prevents me from naming names and listing companies. (We met at KLA-Tencor, but I’m not saying whether anyone from KLA-Tencor was there.) So I switched off my PowerPoint presentation and listened. As we sat in the austere conference room, the talk became interesting—and the CFOs were surprisingly open. Their primary complaint was not what you might think it would be. They did not complain about revenue or profits or about the sluggishness of the economy. They didn’t protest interest rates. Their problem was this: they had too much money sitting idly in the bank. That’s not the worst problem a company can have, but it is a problem.

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