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Up next, innovation in America. The federal investment in basic and applied research is projected to fall. That's to go down for the fifth year in a row now under the new budget according to the American Association for the advancement of science. The National Academies says it's deeply concerned that the scientific and technological building blocks critical to our economic leadership are eroding at a time when many other nations are gathering strength. This summer, Bell Labs, the famous Bell Laboratories, credited with the invention of the transistor, the home to six Nobel Prize winners, shuttered its basic research department. Is Bell Labs a bell weather for the future of science in this country? Here to talk about how to encourage science and innovation is Judy Estrin. Judy is a Silicon Valley entrepreneur, the former chief technology officer at Cisco. And the author of the new book "Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy." Welcome to the program.

Ms. JUDY ESTRIN (Author): Hi. Thank you.

FLATOW: Thank you. Let's talk about the gap. What do you mean by an innovation gap?

Ms. ESTRIN: So, when I talk about an innovation gap many people have said to me, am I referring to a gap between the United States and other counties? And actually, I'm not, because I think that we should not think of innovation as a zero-sum game or a competition with other countries. We want the whole world to be innovative. But what we don't want is for everybody else to be innovative and for us to fall short. And so, the gap that I'm referring to is the gap between where we are now and where we were once as well as where we are now and where we could be, where we should be and where we have the potential to be.

FLATOW: 1-800-989-8255 if you'd like to talk about innovation on Talk of the Nation Science Friday from NPR News. When you say from where we are now, where we are now from where we were once, why did that gap develop?

Ms. ESTRIN: Well, I think there are number of reasons. But when I say once, I think back to the couple of decades or the decade after World War II when the country was really inspired to respect science, get involved in science and both the research communities as well as the development environment - in terms of developing corporations developing products - the beginning of Silicon Valley and entrepreneurship. All of those forces were aligned and the leaders of the country were energized and inspired the country to get involved in science and technology and driving innovation throughout the country.

As the decades progressed, and it began in the 70s when we started to decrease our investment in basic research and basic science, we started allocating research funds to certain fields and not others. In the corporate arena in the 70s and 80s, the focus was on efficiency and productivity. And as you focus more and more on being efficient, you often take out all of the room in your company for surprises for - and that's where innovation often happens. And then as we accelerated into the Internet bubble, even Silicon Valley became more about chasing money and less about really innovating and coming up with new technologies to change the world.

And then when the bubble burst, we had the bursting of the bubble, the discovery of all of the corporate scandals and the tragedy of 9/11 which created essentially - the three together created an environment in which people became very, very risk averse. And the leadership of the country as well as leaders throughout the business world reacted by really pulling in, as opposed to reacting the way the leaders did after World War II to Sputnik and rallying the country.

FLATOW: This is Talk of the Nation Science Friday from NPR News talking about innovation with Judy Estrin as a Silicon Valley entrepreneur, former chief technology officer at Cisco and the author of a new book "Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy." How much of innovation depends on an individual's idea? In other words, corporate leader Steve Jobs or somebody like that who says I'm going to take the rains, and how much does it depend on government forcing people to be innovative?

Ms. ESTRIN: Well, I think that - first of all there are multiple types of innovation and there is incremental innovation which is just making something - continuously trying to improve on something which can happen top down in large companies as well as small companies. But at the innovation, I think that we're really talking is more disruptive, breakthrough innovation that comes from first, basic science and then advanced technology. And I think it can happen in many ways, but what can't happen is it can't be mandated.

FLATOW: Mm hmm.

Ms. ESTRIN: Real innovation needs to be inspired and it needs - you need to provide the support for innovation. And innovation in companies or in a country comes from leaders who provide a vision and provide the inspiration and the challenges to rally people to get involved. And what often stifles innovation - and whether it is a company responding to today's economic crisis or the country responding to threats like 9/11 - that if leaders take that threat and simply use it to scare people and don't use it - don't turn it into a challenge which then inspires people, you end up turning off the leadership function in each individual as opposed to turning it on. And what innovation really comes from is from individuals being inspired to lead and to contribute. Even people like Steve Jobs who are visionaries that have led their organizations, he has done that by inspiring groups of people by providing a vision for the teams to then innovate.

FLATOW: Yeah. Very interesting. We have to take a break. We'll come back and talk about some more with Judy Estrin and take your calls. Our number 1-800-989-8255. Judy Estrin is author of "Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy." She talks about people who say, you just can't put a shingle out and say you've got an innovation team, but if you put the wrong kind people in there you'll not be successful. So, if you could put the shingle out and go to attract the right people. We'll talk to Judi about how to do that. Stay with us we'll be right back.

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FLATOW: You're listening to Talk of the Nation: Science Friday, I'm Ira Flatow. We're talking this hour with Judy Estrin, author of the new book "Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy. And when we went to the break I was quoting actually FedEx chief Rob Carter from your book, where you say you quote him as saying "You can put your shingle out and say that you've now got an innovation team, but the wrong kind of people in there you'll not be successful, but those who are able to innovate successfully seem to be able to do it time and time again. Innovators need to be what I call critically optimistic." Tell us about that.

Ms. ESTRIN: So, I talk about in the book five core values that I think that you need to have in any environment to really foster deep innovation and I think they also apply to the type of people that you need to hire. And they are questioning willingness to take risk, which means a willingness to fail, an openness, patience, and trust. And that critically optimistic that I'm referring to there is that when I say questioning, I'm not just talking about curiosity and curiosity definitely drives innovation, and when you're looking to build teams that are going to be innovative you really want to look for people that are inherently very curious.

But the second part of it is that the necessity - the need to self assess so you need to not just question others, but be willing to question your self and have a some self doubt about what you're doing. And the interesting thing about innovation that you need to be incredibly optimistic to get over the hurdles and obstacles that are thrown in your way, but you need that aspect of self assessment and self doubt to be able to stop every once in a while and say, you know, what am I doing the right thing? Could I be doing this differently? Is there something else going on here or some surprises that I might see if I open my mind and look a little bit more broadly.

FLATOW: I've got a multiple number of questions from folks in second life and from the phone is asking basically the same thing which is an obvious question at this point. With the meltdown in the stock market in the last few weeks. Are we now folding up our (unintelligible) a little bit and thinking gee, I haven't got the money now to invest in innovation, I might have a few bucks - had a few bucks, that's all - they're all gone. I mean, is this something that you worry about?

Ms. ESTRIN: Well, I do worry about it because the reason I wrote the book is I was worried about it to begin with, starting two years ago that already we were not - there was too much incremental innovation. That the country has become too short term focus and so there is a lot of incremental innovation going on at the surface, but planting the seeds for the future. I talk about having an innovation deficit that were reaping the benefits of 10, 20, 30 years ago, but we're not planting the seeds for future innovation. And I do worry about the economic crisis just making that worse. But the companies that I see that are in a strong position and have strong leaders are actually not doing that.

What they are looking at this is the time to continue to invest in key areas of innovation, and so it's not that they are not cutting back, all companies need to look at their expenses and adapt to the new realities, but you know, to quote someone - Obama from the debate "You don't use an ax, you use a scalpel in doing that," and so the easiest thing to do is just to cut off all research, and cut off all future investments, but that's absolutely the wrong approach because when we emerge from this and whether it is one year, two years, or three years - we will emerge from this. Those companies that have continued to invest and keep some part of their budgets investing in the future will come out stronger.

FLATOW: Tell us a bit about the core areas - the core long-term innovations that you see we need to do?

Ms. ESTRIN: Well, in terms of fields and areas of science that we need to be focused on, I will say that one of the things I think we need to do is make sure that we're investing across all fields of science, because you never know what problems are going to face you 10, 20, or 30 years from now. One of the problems we have today is that we starved investment in physical sciences and environmental sciences for decades. And today we really need those scientists, and we lost a generation of scientists as we look at our problems in terms of energy. But if you look at the major problems we have as a country and as a planet, we need to be investing in alternative energies. We need to be investing in those technologies and energy sources that will be clean and scalable, so that we can reverse climate change. And we need to understand - continue to understand climate change better so that we can change our behaviors and reverse those trends.

Clearly health care, affordable and accessible - health care will not stifle innovation in that area. So there's been so much progress in the health care arena, you were just talking about it, in the area of genetics and one of my concerns is that people will say, the way to reduce costs and health care is to stop innovation of new pharmaceuticals or new medical procedures. That's not the way to reduce cost. We need to look across the whole system and make it more affordable and available, while not stifling innovation.

Clearly, education is another area that we need to innovate in a way we change our education system, because it today is not set up to produce innovators, it's set up to either produce people that don't graduate - either don't graduate or graduate with the skills to test well, but not necessarily with the skills to collaborate or the skills to frame the questions. And if you want innovators, you need people that know how to ask questions, not just answer the questions on the test.

FLATOW: Is that something you teach people or is that something that we have to find in ourselves? I mean, will it have to be brought out? Is that the skill or a craft you teach someone?

Ms. ESTRIN: You know, I think that we all look at little kids and I think people are inherently curious and inherently question. How often do parents get tired of their two or three year old asking why? And I think actually our education system beats it out of us. And so, I think it's a question of - yes, I think it can be taught. But it's not taught as a subject. It has to do with the way you teach kids and the way you parent kids or the way you mentor kids. And I think our approach to children as they grow is increasingly to essentially stifle those attributes, the core values that I talked about, that are so necessary for innovation.

FLATOW: 1-800-989-8255, Brian in Omaha. Hi, Brian.

BRIAN (Caller): Good afternoon. Actually, what you were just talking about is exactly what I was calling about was - my question is from the perspective of a parent, I have a nine-year-old boy who is I think brilliant. Loves science and loves math. And I've been increasingly frustrated with the ability of the public schools to even keep to his level or even try to foster that curiosity like you were talking about. And I just wondered what I can do as a parent of, you know, and what I can do as a city's been to encourage better education for these kind of...

FLATOW: Yeah.

Ms. ESTRIN: Yeah. So I think there are probably two parts to that question. One is, what can you do influence the education system overall? Because there's no question in my mind that we need to change the way we educate our kids, not just to produce more scientists than it's - we need to inspire our kids to stay interested in science because up until around the fourth of fifth grade, kids tend to be interested and then we see an incredible drop-off as they move towards high school. But we also need everybody who graduates and - or even doesn't graduate, we need every citizen of this country to be more scientific and technologically literate, because today, to make decisions about your health, to know how to vote, you need to have a basic understanding of science and technology.

So, what can you do in terms of changing the education system? I think that there are nonprofits that are working in this area that you can get involved in. You can get involved with your local school board, because a lot of educational decisions are made at the local level or at the state level. And how you vote in this election will end up influencing what happens with education in this country down the line. We've actually taken multiple steps backwards over the last eight years. Both because of educational policy like No Child Left Behind which backfired in terms of inspiring kids and teaching kids in science, but also, the overall culture in the country, the lack of respect for science, the seemingly not viewing scientific evidence as important in the decision making of the country.

So I think how you vote is - can make a big difference in terms of education. Now the other part of it is what can you do as a parent for your own kids, or if you're not a parent and you mentor other kids, that will help develop them in spite of the education system? Because in fact, it's going to take at least a generation to solve the problems we have in education, And I think there are things you can do to encourage your child to explore, whether it's online or off-line, to give them room think and get them thinking about asking questions and really listen to them when they ask questions and if they're asking questions, don't just shut them up, but engage them in discussion that they grow up understanding that critically thinking about something is important.

FLATOW: Is the...

Ms. ESTRIN: There are also...

FLATOW: I'm sorry, go ahead.

Ms. ESTRIN: I was just going to say, there are a couple of non-profits that are working in this area, one that I talk about in the book which is actually four profit company is Sally Ride Science and Sally Ride, the first woman astronaut, has started a company to produce clubs and products and...

FLATOW: Well we always - we always get back to the space race, sometime or other, because it's a nostalgic look back, is it not? I was a child of the space race. We were all very excited. We had something that united the country and it was obviously a political move in the end, but it was a technological feat - you know, a tremendous technological feat that everybody was interested in. Is there nothing today that we could use in, you know, we don't own space anymore. I mean, you touched on a bit of becoming green and green technologies and saving energy, could we not unite around something like that for everybody to take part in?

Ms. ESTRIN: Oh, absolutely. And when I was - I interviewed over 100 people in writing the book and many of them said to me, you know, Judy what we need is another sputnik and I would walk out of the room and say, wait a minute. We have another sputnik. We have threats that are just as powerful as sputnik. Our leadership however is not using those threats to inspire us. They are using those threats to keep us scared, perhaps, and nobody has rallied the nation around them. And so the most significant of them out there is the combination of lessening or eliminating our energy dependence and reversing climate change and you take the two of those together, ie. the Green movement and there's absolutely no reason why we as a country should not rally around that to inspire businesses, nonprofits and every citizen in the country to get involved.

It would create new jobs. It would change the psyche of the nation. And there are other problems such as - I talked about health care, such as our standing in the world, security that are also threats that could be used to rally the country. And in the book, I talk about these and say, you know what? Each one of these deserves its own moon-shot. The one that is the most present in people's minds I believe and is really something we should be starting to do right now is this whole notion of green - the combination of energy independence and reversing climate change.

FLATOW: Talking with Judy Estrin on Talk of the Nation Science Friday from NPR News. She is author of "Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy." Our number is 1-800-989-8255. Let's see if we can get a phone call or two in before we have to go. Let's go to Stevens San Jose. Hi, Steve.

STEVEN (Caller): Hi. Thank you for taking my call and you got a great subject. But I do have a difference of opinion between the guest speaker when she mentioned that it is, you know, we're in dire state. Personally I think this is the most exciting time in human history. To say that the last couple of decades when the Internet bubble has come and gone and nothing - it's just really over simplifying the issue here. For example, the Internet is by far the most disruptive innovation by far. For example, since the telegraph of how humans have communicated and the cell phone as well and then in many more other areas in terms of medical research right for biochemistry for...

FLATOW: So, you're saying, well I'm running out of time but I want - so summarizing, you're saying we are in a very exciting time.

STEVEN SAN JOSE: Yes. I think we are in a very exciting time.

FLATOW: Innovative time. Judy, how do you...

Ms. ESTRIN: So, yes. So, you actually just made my case. I'm not saying that we are - have no innovation, number one, but everything that you just named and I was involved in the early development of the Internet but from the Internet to the cell phone to the PC to the discover of DNA and RDNA, if you really think about when that began, the seeds of those innovations were planted 30 years ago. In my book when I was interviewing Mark Andreessen, who was the developer of the first browser. He said to me, Judy, I was able to do it so quickly because it was the icing on the cake that had been baking for 30 years.

So there is no question that there's lots of interesting innovation going on in mobile technologies and health care, in consumer internet. But we have stopped over the last couple of decades implanting the seeds that we'll continue that innovation out 10, 20, 30 years from now. And if we don't plant those seeds today, and if we continue to just build on icing the cake that we baked, started baking 30 years from now, we will hit a wall. So today, we are still - do still lead in innovation, but we have become more and more short term focused and we're not planting the seeds for the future. We are not investing for the future.

FLATOW: Especially in our kids, in our education system, things like that. All right., we've run out of time. Judy, I want to thank you for taking time to be with us. Judy Estrin is a Silicon Valley entrepreneur. The former chief technology officer at Cisco and the author of the new book, "Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy." Thank you, Judy for taking time to be with us.

Ms. ESTRIN: Thank you and thank you for doing this show.

FLATOW: You're welcome. Greg Smith composed our theme music and we had help today as always and we needed a lot from NPR librarian Kee Malesky. If you want to write us, surf over to Web site at sciencefriday.com. We're podcasting and blogging and doing all kinds of great things over there. I'm looking for your help and your contribution. Have a great weekend. We'll see you next week. I'm Ira Flatow in New York.

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