Oú Est le Boeuf?


America's Struggle for Leadership in Technology, by Jean-Claude Derian, Cambridge, Mass.: MIT Press, 309 pages, $25.00

Jean-Claude Derian, who served as chief science counselor at the French Embassy in Washington from 1984 to 1987, is quick to say that he is not the Tocqueville of high technology. Alas, this is not false modesty. Perhaps it is the curse of French commentators on American culture that they be held to Tocquevillian standards. But then, I'm sure the French intellegentsia—of which Derian is a card-carrying member—wouldn't have it any other way.

America's Struggle for Leadership in Technology offers a distinctly French perspective on the debate surrounding industrial policy and technological superiority. As one might expect, Derian offers what can best be described as a "mixed-market" lens through which to view America's multiple innovation infrastructures. He's most comfortable discussing the intersection of government policy and industry, least comfortable when trying to examine the alchemies of the innovation process. He represents a useful point of view for interested Americans to consider, but I doubt he will change anyone's mind in Washington, on Route 128, or in Silicon Valley. Derian might have been better off if he came from Tokyo rather than Paris.

In keeping with the tradition of Diderot, Descartes, and other French scientist/philosopher types, Derian's chief analytical tool is categorization: a place for everything and everything in its place—even if it's a tight squeeze. His thesis is based on a fairly simple idea: that there are essentially two cultures of high technology. One culture is "sheltered"—protected either by geography, national security (Hughes, TRW, General Dynamics), or monopoly (the Bell System). The other is "exposed"—in other words, market-driven, like Silicon Valley, Route 128, and, yes, Japan's keiretsu, industrial pseudo-conglomerates like Mitsui.

Sheltered companies have semi-captive customers; exposed companies are subject to the whims and vagaries of their customers. America, says Derian, is struggling to strike a new balance between these two disparate cultures as it endeavors to compete with the Japanese and the Europeans in an increasingly global high-tech marketplace.

Though this book has its moments, it does a far better job of being informative than being compelling. Unlike Tocqueville's, Derian's analysis lacks soul, and his insights lack wit. (On the other hand, you can't help wondering if Derian was displaying extremely subtle Gallic humor when he made his "Made in USA" chapter on the revival of American industry chapter 11.) A book by a Frenchman grappling with issues of American culture and technology needs esprit and élan to capture the reader, not the desiccated recitation of high-tech market-share statistics.

An American reader wants the French perspective to be brimming with provocative assessments and unusual angles, providing a sense of the differences between what technology means to Europe and what it means to the United States. Although he clearly has a firm technical grasp and a broad vision, Derian doesn't deliver. What we have here is merely an elegant outline filled with relevant data.

For anyone who even casually follows high technology in the Wall Street Journal, Business Week, or any one of a dozen trade publications, Derian's comments can hardly come as news. The issues of "competitiveness" and that Bush administration bugaboo, "industrial policy," revolve around the kind of balance that should be struck between pure market forces and government involvement. We don't need a Frenchman to tell us this dichotomy exists; we need a Frenchman to tell us what this dichotomy means and what we can do about it. Derian would rather be a diagnostician than a healer.

Unfortunately, Derian's discussion of America's two cultures of high-tech capitalism is marred by typos and inaccuracies—Genentech is not "Genetech" and the CEO of Lotus is Jim Manzi, not "Lanzi." (For a prestige university press like MIT to permit errors like these to appear under its imprimatur says more about the American concept of quality control than a dozen books on U.S. competitiveness.) More important, this book is marred by an unrigorous approach to these techno-cultures.

While Derian relentlessly cites newspaper articles and book passages, he appears to have conducted only a handful of interviews with real, live people. Tocqueville should be spinning in his grave if this is how the French elite gets its insights into American culture. To appreciate the dynamism of Silicon Valley or Route 128, you have to be there. Entrepreneur may be a French word, but it has been thoroughly Americanized as a high-tech phenomenon. Derian utterly fails to give us the French perspective on what makes American entrepreneurialism tick. Instead, he quotes American sociologists. Some of my best friends are American sociologists, but I wouldn't give them the last word on Silicon Valley culture. The only way to get a sense of a culture is to get a sense of the people.

No American with an ounce of brains would claim special insight into French culture on a diet of Crozier, Foucault, Sartre, and Le Monde without at least having spent time with the French in France. Similarly, no matter how many newspapers and magazines you read about Silicon Valley and Route 128, you just won't get it until you go there, drive around, and go into the companies themselves. It's not enough to analyze; you've got to feel and use your feelings to temper that analysis.

Derian would rather show a chart indicating degrees of market "exposure" than write a passage that illuminates what makes an American software entrepreneur possible and a French one unlikely. I fully appreciate that this was originally a book for the French, but I consider it a wasted opportunity that Derian did not give of himself in pointing out what makes an American engineer an entrepreneur while a French engineer stays at Thomson CSF or Matra.

Perhaps because he is a French technocrat, Derian is on surer ground—albeit looking in the wrong direction—when he writes on government policy. He rightly points out that the U.S. government has played a critical role in the development of key technologies such as computers and biotechnology. However, he doesn't quite appreciate that the federal government here doesn't exert quite the same influence as in, say, France. Derian argues that the Strategic Defense Initiative played a vital role in shaping America's high-tech base. In fact, as even its supporters will concede, it did not. SDI was just that—a defense initiative that had questionable value in terms of commercial spinoffs and the industrial base.

Similarly, when Derian states that the Pentagon is America's MITI, he demonstrates that he has a better grasp of inside-the-Beltway ideology than marketplace realities. Indeed, for the past five years or so, Washington policy intellectuals have been complaining that the Pentagon doesn't do enough to encourage investment in America's high-tech base. When the director of the Defense Advanced Research Projects Agency—the Pentagon's high-tech venture capital unit—tried to boost Defense Department involvement in private development efforts, he got sacked.

Derian does a fine job of comparing the nature of European and American sheltered industries—notably the airline industry, where he looks at Airbus versus Boeing. He also writes with authority about how Europe is beginning to make the adjustment from sheltered to exposed in its own high-tech industries. His commentary on Japan, however, offers nothing new. I'm skeptical of his claim that Japan's high-tech industries are more "exposed" than "sheltered." Today, sure—but 10 years ago?

The fact is, as Derian acknowledges, that government guidance played a significant role in the evolution of Japan's high-tech base, just as it did in the evolution of America's. Japan's keiretsu system provides both a cultural and financial subsidy for innovation. The keiretsu is a guaranteed buyer of innovation, significantly reducing risks and costs. That's one of the problems with categories: It can be tough to make things fit neatly.

Former IBM Chief Scientist Lew Branscomb's introduction to the book gives you 70 percent of what you need to know about Derian's dichotomies in a fraction of the time. The tragedy here is that Derian's arbitrary categories created a Procustean bed for his insights and personality. Indeed, I defy anyone who reads this book to tell me anything substantial about Derian. Tocqueville gave America a unique and powerful journal of its cultural life and times. He could only do that by giving of himself as an observer. Derian was in a position to do much the same for America's cultures of high technology. He didn't. Too bad.

Michael Schrage writes the "Innovation" column for the Los Angeles Times.