U.S. tech leadership to go way of 2004 Dream Team?

Unless the states focus on maintaining their gold standing, AEA warns, "American losses will not be confined to the basketball court."

Humbling losses by the U.S. men's basketball team at the Olympics last year could hint at what lies ahead for the nation when it comes to economic and technological leadership, according to a new report from a tech industry trade group.

The study, to be released Tuesday by the American Electronics Association, argues that the next wave of breakthrough technologies could be created abroad if the United States does not act now to maintain its competitive edge.

"U.S. policy-makers and industry leaders need to recognize that as we neglect our technology infrastructure--skilled labor, (research and development), and a business-friendly environment--many countries are adopting economic reforms and are directly competing with the United States for foreign talent, innovation, and technology products and services," the report states. "Unless this realization hits home, American losses will not be confined to the basketball court."

The study comes on top of other calls for the United States to take steps to improve its technological competitiveness vis-a-vis other parts of the world. Technology prowess is seen as critical to a nation's overall economic health, given the way advances can create new industries, high-paying jobs and a higher standard of living.

To be sure, the U.S. system of technological innovation isn't in tatters. Many United States-based computer and Internet companies are doing well, venture capital investment in tech mecca Silicon Valley is rising again, and the country boasts top research universities.

But other nations have been building up their technology industries. India and China, for example, have attracted research operations from technology companies such as Microsoft, IBM and Intel.

And critics have called attention to potential problems in the United States, including relatively safe research projects and a declining presence of women in the computer field.

The new report from AEA calls for more funding for the National Science Foundation, specifically for research in the physical sciences, engineering, math and computer science.

U.S. federal funding of research and development (R&D) has declined over the past two decades, the report states: "It peaked in 1987 at $75 billion and still was below this peak by 2002 at $71 billion, adjusted for

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