Competitiveness and Innovation

Barack Obama (D)

Obama’s campaign site lists investing in American manufacturing and innovation as a priority, saying that he “provided tax incentives and made investments in clean energy technologies such as wind turbines and advanced car batteries to grow high-technology U.S. manufacturing capacity and supply clean energy projects with American-made parts and equipment” and “launched the Advanced Manufacturing Partnership, a national effort to invest in technologies that will create high-quality manufacturing jobs and enhance America’s global competitiveness.”

He also touts the American Recovery and Reinvestment Act of 2009. Among other things, this bill funneled $18.7 billion into research and development.

Mitt Romney (R)

On his campaign site, Romney says “for America to truly benefit in global commerce, we need to ensure that our entrepreneurs can sell their high-quality products and services around the world.”

Romney proposes encouraging free trade by reinstating the President’s Trade Promotion Authority (also known as the Fast Track), completing Trans-Pacific Partnership negotiations, and creating a “Reagan Economic Zone,” which would open up trade with countries that offer greater intellectual property protection. Romney also proposes economic sanctions against China to deter unfair Chinese practices, including designating China as “a currency manipulator.”

Romney notes, “Our system of corporate taxation is also in urgent need of an overhaul. Right now, with a top marginal rate of 35 percent, it vies for the developed world’s highest, placing our companies—indeed, our entire country—at a competitive disadvantage. Thus he proposes reducing the corporate tax rate to 25 percent and switching to a territorial tax system where companies are only taxed on their earnings within the United States, not on their global earnings.

Furthermore, Romney asserts that if the United States is to remain a world leader in innovation, it is imperative that the federal government continues to invest in scientific research. In his recently released education plan, he stated that "the long-term federal investment in basic research within institutions of higher learning has been a crucial engine for innovation in our economy,” and pledged to continue to fund and support university research in the biological, physical, and social sciences.