Societal challenges require transformative solutions, and the last few weeks have been a reminder about the importance of innovation for the public good. COVID-19 has shown up and impacted civilization faster and more swiftly than anything we have seen in a century. While our country has a robust innovation pipeline and over a thousand institutions developing innovators and entrepreneurs, we don’t have similarly strong pathways for innovators creating public goods in areas like vaccine development or education technology. The results have been on display over the last few weeks – shotgun starts to create a COVID-19 vaccine, coronavirus tests and treatments created on the fly, and parents frantically struggling to figure out which online education tools to use for their suddenly home-bound children.
The US Congress is currently putting the final touches on a relief bill that could provide as much as $2 trillion in direct transfers to American families and concessional loans to American businesses hit hard by COVID-19. Previous legislation passed just weeks ago, provided over $8 billion for medical supplies, vaccine development and treatment. The US Federal Reserve has used many of its tools of monetary policy, such as dropping interest rates and buying US Treasuries. It’s not clear how many more tools the US Government has left overall to fight the effects of COVID-19.
MIT Solve 2019
In our urgent desire to ward off a health and economic disaster, we must also use some of this massive stimulus to innovate for the public good beyond the current crisis. A public good is often defined as a good or service made available to everyone in society by government or the private sector. Innovation for the public good usually involves the same entrepreneurial journey but ends with a product that may only have one customer – the government. These innovations are still based on sound science, research & development, and often face the same regulatory hurdles as purely profit-driven products. But once developed, they normally don’t scale by grabbing eyeballs, raising lots of venture capital or using intellectual property defensively, but instead through heavy subsidizes in order to ensure widespread adoption or compliance.
Our lack of innovation in many public goods has been laid bare this week. Vaccines, Internet access and education technology being prominent examples of products and services ALL Americans needed this week and weren’t readily available.
As a country, we have historically under-invested in vaccine development and other public health solutions. Every few years there is a flu outbreak caused by a new strain of influenza that we did not anticipate – exacerbated by a short-term lack of manufacturing capacity for producing new flu vaccines. Overall, according to the National Institutes of Health, less than five companies in the United States produce all the vaccines recommended for regular use for children and adults. And the total budget for all children’s vaccine programs hovers annually around $1 billion – compared to nearly $50 billion annually for cancer research.
Vaccines are a public good – there is no buyer except governments and multilateral institutions like the World Health Organization. If the life sciences industry does not want to invest in vaccine development because there is no clear business strategy, then it behooves governments around the world to do so and prepare for the next pandemic. Restarting the National Security Council’s Pandemic Preparedness Office would be an obvious first step.
Access to the Internet is partially a public good. Anyone else struggled with choppy Internet this week? Our lack of 5G Internet is a strategic policy failure. Regulatory capture by American telecommunications firms has resulted in Americans having few choices for their Internet service provider, and a very slow roll out of 5G Internet nationwide. According to Broadband Now, nearly 40 million Americans lack access to any broadband Internet. That doesn’t include those who have access, but cannot afford a broadband connection, which often runs over $50 monthly in the Northeast alone. There is ample evidence that teleworking can be efficient and productive, but if we don’t invest in broadband for rural areas, municipal WiFi networks and rapidly roll out 5G Internet service, we will continue to have the problems of productivity that have made companies reluctant to embrace teleworking until it was absolutely necessary this week.
And after two decades of hyping education technology, millions of Americans learned this week how little capacity our schools have to leverage technology for learning. Throughout the nation, school districts are sending email and phone surveys to parents to understand whether they have home Internet access, tablets/laptops/printers that children can use and whether parents are around to help with learning. One in five teens say they can’t complete assignments because they don’t have reliable access to the Internet or a computer, according to the National Digital Inclusion Alliance.
This disconnect is not due to a lack of VC investment or startup formation. It’s because technology is a vehicle to support learning, which is a public good provided to Americans through primary and secondary schools and public universities. COVID-19 provides us with an unfortunate opportunity to truly move American education online and fulfill the vision of blended learning. More research needs to be done about how technology can support learning, and many, many more pilot programs need to be funded between school districts and ed tech providers to figure out the details around access, fairness, content and privacy. The next pandemic should not have to create so much distortion in the academic year.
The most common image of innovation and entrepreneurship in America is that of the young white male (in hoodie) pitching to venture capitalists and building a technology company worth billions. It’s a story that has been perpetuated by the media in shows like ABC’s Shark Tank and HBO’s Silicon Valley. But it’s also true. There are many inspiring stories of entrepreneurs creating products and services of enormous societal and economic value.
But the COVID-19 crisis has exposed some of the problems with our private-sector led innovation model. While we celebrate startups and small businesses that use private venture capital or bank loans to scale their businesses and build global brands, the reality is that there are certain conditions where the government must take a more active role. When the next pandemic hits, we should be able to ramp up production of vaccine and medical supplies and send people home to work and learn with a lot less disruption. We can’t prevent more pandemics, but we can be better prepared in so many ways.