WHITE HOUSE INNOVATION STUDY FALLS SHORT

News of the Week

WHITE HOUSE INNOVATION STUDY FALLS SHORT Waves of discontent began rippling through that vague entity known as the innovation community last week when the White House released its monumentally sincere, long-awaited plan to spur technological creativity in U.S. industry. The document was a Presidential decision memorandum on innovation and was the result of an 18-month study headed by assistant secretary of Commerce Jordan S. Baruch.

High hopes rode on the effort. Hundreds of persons from industry, universities, and public interest groups participated in the dialogue. Public interest groups asked the question, "Innovation for whom and for what?" Industry wanted tax help, access to investment capital, and solid relief from the high cost of regulation compliance. Academics wanted more money through new centers and in­stitutes.

But the result, as everyone feared, was very little. Arthur D. Little's Michael Michaelis, who is trying to form a high-level industrial pressure group in the field, tells C&EN, "The government is not really serious about innovation. They paid only lip service to it."

He adds, "They might say that because of the 18 months it took to do the study and the hundreds of people that were involved in doing it that they heightened the national aware­ness about the importance of inno­vation. I say baloney. We've been aware of the issue for a long time."

In hearings conducted jointly be­fore four Congressional committees an hour after the White House re­leased the program, Sen. Adlai E. Stevenson (D.-Ill.) said the package contained too little and came too late.

But here and there positive com­ments were heard. Rep. George Brown (D.-Calif.) of the House Science & Technology Committee says the program is a good start. The legislators attending the hearing generally congratulated Baruch on a good job.

The best thing that can be said about the Carter package is that it tries to be conceptually integrated. But people differ even on that. A Capitol Hill analyst says he sees no connection among the nine steps the President lays out. "The whole thing reminds me of a wet Kleenex tissue,"

the analyst says. "I see no overall theme. Even the words sound ama­teurish. It reads as if innovation is a commodity, that if you open the spigots, innovation will flow. It's like opening a 1-inch waterline to fill a reservoir. The effort is so small com­pared to the size of the problems and opportunities, that the result is just sickening."

That's pretty damning. J. Herbert Hollomon, director of the Center for Policy Alternatives at Massachusetts Institute of Technology, was kinder. Hollomon, who organized a sympo­sium two weeks ago on the subject, tells C&EN he is pleased that Carter did something but that without tax incentives and investment credits the package really doesn't do much. "I don't think the size of the program or the content anywhere matches the size of the problem," he says.

The consensus is that the President has really thrown the ball on innova­tion to Capitol Hill. Several bills on various aspects of innovation support have been introduced over the past year, but action has been withheld while everyone awaited the Presi­dent's message.

Time, however, is tight, because in less than four months attention will turn to the election campaigns.

A task force on innovation con­sisting of about 20 Senators and Representatives is being formed under Rep. Les Aucoin (D-Ore.). What is clearly needed is either a

Baruch: headed 18-month study

single, encompassing bill on innova­tion or an integrated legislative package that will grab the attention of the House Ways & Means Com­mittee, Senate Finance Committee, and Judiciary committees of both houses. Only that way will a true in­novation debate in Congress get started.

These are some of the highlights of the President's program:

• Tax, capital investment, and depreciation policies put off until Carter produces his fiscal 1981 tax package. Innovation thus becomes subsumed under a broader tax debate and will likely lose all public promi­nence.

• Programs within the National Technical Information Service in the Commerce Department to collect and disseminate logically information on federal and foreign technology rele­vant to domestic industry. The belief is that this, though desirable, proba­bly cannot be implemented effec­tively. Strategic data centers such as these simply do not work because of the sheer inability of the information industry so far to integrate data.

• Generic technology centers to spot the unnoticed technologies that underlie progress within corporations, such as process improvement by means of microprocessors. Four cen­ters would be established to explore those developments with the broadest industrial potential.

• More industry-university coop­erative R&D projects through federal funding, with a target budget of $150 million for fiscal 1980. Also, state/ federal innovation development centers to spur availability of invest­ment capital for entrepreneurs.

• A small bundle of patent policy changes already recommended, such as a uniform federal system for li­censing patents to companies, im­provements in Patent & Trademark Office procedures, and lessening the probability of litigation over patent validity. No steps were recommended for helping that dying breed, the in­dividual inventor. • Clarifying antitrust policy by get­ting the Justice Department and Federal Trade Commission to talk more with entrepreneurs and in­dustrialists about the limits to their joint-venture activities.

• Improving the regulatory system

6 C&EN Nov. 5, 1979

by stressing performance standards in regulations rather than specifying the kind of technology a company would be required to use for compli­ance.

There are more, having more to do with getting the bureaucracy to think through its rules, regulations, and programs in terms of improving the innovation climate. But the program is modest, many observers are dis­pleased, worry continues to rise, and the Administration thus faces one more discontented interest group as elections near. •

Three Mile Island panel issues report On March 28, the first major nuclear power accident in the U.S. occurred in Metropolitan Edison's reactor at Three Mile Island near Middlesburg, Pa. It sent the nation and the world into a frenzy, slowed the momentum of the commercial nuclear power in­dustry, and set into motion a series of investigations on the causes and ef­fects of the event.

The report of the President's Commission on the Accident at Three Mile Island is one of the first to sur­face publicly from the flurry of stud­ies. The 12-member citizens panel presented its "cohesive package" of findings and 44 recommendations to the President on Oct. 30, and then went to Capitol Hill to sell the rec­ommendations to Congress.

After a six-month investigation, the so-called Kemeny Commission (after its chairman John G. Kemeny, pres­ident of Dartmouth College) con­cludes that the utility company's op­erators were insufficiently knowl­edgeable and did not possess the expertise needed to cope with the challenge of the accident. The panel also finds the Nuclear Regulatory Commission's present organization, staff, and attitudes—attitudes that equate regulations with safety— unable to provide an "acceptable" level of safety in nuclear power plants. Given these circumstances, a pre­ventable accident such as that at Three Mile Island was "eventually inevitable," Kemeny says.

Therefore, the panel makes an overall recommendation: To prevent

ACS ballot deadline

As there is no mail delivery in Wash­ington, D.C., on Monday, Nov. 12, Com­mittee on Nominations & Elections will accept ballots received at ACS head­quarters through Tuesday, Nov. 13.

future accidents of the magnitude of Three Mile Island, "fundamental changes" are required in the organi­zation, procedures, and attitudes of the nuclear industry and NRC to keep the risks inherent to nuclear power within "tolerable limits."

The accident demonstrated that no matter how sophisticated and re­dundant the equipment is, no matter how well the equipment functions— and it performed admirably at Three Mile Island—the human element must not be overlooked. Minor equipment failures at the plant snowballed into a major accident be­cause of inappropriate actions by utility operators, reactor builders, and NRC personnel. Fundamental changes, especially a sharper focus on safety, will have to take place within these sectors, the panel says.

The commission was highly critical of Metropolitan Edison and the re­actor maker, Babcock & Wilcox, cit­ing shoddy maintenance procedures and poor operator training. But it reserved its most severe criticism for the five-member NRC, calling it a "headless" agency whose preoccu­pation with regulations and licensing procedures deflected its attention from resolving safety problems.

There was no recommendation to ban construction of future nuclear plants simply because a clear majority could never be reached on any of the three moratorium statements put forward. The commission did, how­ever, call for abolishing NRC and re­structuring it as an independent agency within the executive branch, headed by an administrator ap­pointed by the President. To monitor the performance of this new NRC and the industry, the panel recommends the formation of a permanent over­sight committee that would report annually to Congress.

Among the other major recom­mendations:

• Establishing agency-accredited training schools for operators.

• Establishing a program to spe­cify and evaluate safety standards.

• Initiating studies on the probabilities and consequences— including meltdown—of nuclear ac­cidents; on the chemical behavior and retention of radioactive iodine in water; and on health-related radia­tion effects.

• Redesigning instruments to provide proper warning and diag­nostic data.

• Licensing a new reactor only if the state in which the plant is to be sited has an emergency response plan; periodic review of this license; and plant siting far removed from densely populated urban centers.

The March accident will cost

o o .c Q.

Chairman Kemeny holds up copy of report on Three Mile Island accident

Metropolitan Edison's parent com­pany, General Public Utilities, be­tween $1 billion and $2 billion, the Kemeny commission estimates, and more if the reactor is never restored to operation. Long-term health costs are likely to be negligible, but the short-term mental stress was severe.

Industry in general supports the Kemeny report findings. Floyd Lewis, chairman of an ad hoc electric utilities committee formed after the accident, agrees that "the improvement of safety . . . is the crucial issue." Taking the failure to agree on a moratorium as partial vindication of the industry, Lewis says that the commission's message is to "proceed, but proceed with caution."

Although personnel assigned to Three Mile Island were among the most qualified in the U.S., General Public Utilities chairman William G. Kuhns says that "all reactor operators will undergo extensive retraining and examination [and recertification by NRC] with increased emphasis on the basic elements of reactor safety."

Not only can NRC recertify oper­ators, it can impose fines for infrac­tions of rules. Using this authority, it fined Metropolitan Edison $725,000—the largest such fine ever—for 11 civil violations. However, its limited statutory authority re­quired it to lower the proposed fine to $155,000.

The Three Mile Island incident is not a closed book, nor will it be until the crippled reactor is cleaned up. The Kemeny report, only one chapter in this book, is entitled "The Need for Change: The Legacy of TMI." An additional legacy may be reinforce­ment of the conviction that man's technology has far outpaced his abil­ity to control it. •

Nov. 5, 1979C&EN 7