Dangers in pinning our hopes on trickle down technology.

• Author: Rifkin, Jeremy

The high-tech vision set forth by the President could lead to increased unemployment, a further erosion of the middle class, and even greater disparity in income between rich and poor

In the 1992 presidential campaign, Bill Clinton effectively attacked the economic policies espoused by two successive Republican administrations. By Election Day, he had convinced much of the electorate that the trickle down theory - the idea that tax breaks and other incentives to the rich spur investment and productivity that ultimately translates into increased employment and income for the middle class - was at best a myth and at worst a convenient rationale to justify continued government giveaways to America's wealthiest corporations and individuals.

Now that he is president, Clinton may be creating an equally damaging economic myth - one that seriously might undermine his efforts to stimulate the economy. While he has rejected trickle down economics, his national economic strategy amounts to little more than trickle down technology.

The Clinton plan to rejuvenate the American economy first was outlined in a position paper issued during the campaign entitled "Technology: The Engine of Economic Change." The plan, influenced heavily by the privately financed Council on Competitiveness, calls for a partnership between the Federal government and corporate America to spur new high-technology industries and a 21st-century infrastructure to accompany them. Impressed with the strides made in Japan by a similar government-corporate alliance, the Clinton White House is staking its economic success on a high-tech future.

Clinton hopes to fuel the new technology renaissance by transferring billions of dollars of research and development funds from the Pentagon to civilian commercial uses. High on the list of research priorities are biotechnology, robotics, artificial intelligence, digital imaging, and data storage. If all goes as planned, the Administration expects to spend as much on researching and developing new technologies as the previous two Republican administrations spent on Star Wars, and in half the time.

The emphasis on civilian technologies is being sold to Congress and the country as a vital national security interest - a strategic effort to maintain the U.S.'s competitive trade advantage and commercial clout against both the Japanese and the European Community. According to the President, only by strengthening our civilian technology base can we solve the twin problems of national security and economic competitiveness." Vice Pres. Gore will direct the government effort to create a high-tech economy for the 21st century.

The decision to pour billions of dollars into the creation of new high-technology industries may prove to be a mistake of great historical proportions, with incalculable consequences for society. The high-tech vision set forth by the President, fully implemented, could lead to increased unemployment, a further erosion of the fortunes of the American middle class, and even greater disparity in income between the rich and poor. To understand how and why this dystopian future might come to pass, consider the unique set of economic and social forces being set in motion by the current transition of the American economy toward a high-tech future.

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