Trump’s war on innovation is a golden opportunity for Australia, if we’re smart enough to take it

The United States has been the world’s innovation engine for a century. It’s an enviable position that has delivered it, along with allies such as Australia, economic progress and strategic technological superiority.

Trump’s decision to bar international students from attending Harvard University and a pause on all international student visa interviews are the latest steps in an assault on American research and innovation.Credit: Bloomberg

This engine is fuelled by the US’s superpower-like ability to draw in the best and brightest internationally. It boasts world-class innovation ecosystems – the result of decades of strategic government investment, pro-innovation policy, and an immigration system designed to attract the world’s best talent – that promise an unbeatable environment to innovate in.

As Australian students at Harvard and Massachusetts Institute of Technology (MIT), we’ve been lucky enough to experience the excitement of a thriving US innovation ecosystem where world-class researchers and young scholars work alongside entrepreneurs and highly skilled workers to take an idea to market.

Now we’re watching in real time as the US blunders its superpower as a magnet for global talent and innovation.

US President Donald Trump’s decision to bar international students from attending Harvard University and this week’s pause on all international student visa interviews are the latest steps in an extraordinary assault on American research and innovation. This hostility to foreign talent, combined with drastic cuts to federal research funding, has left many of the world’s best scientists, innovators and high-skilled workers looking for a new place to ply their trade.

This presents a generational opportunity to steal a jar of the US’s secret sauce and supercharge Australian innovation.

The countries that can offer this talent pool the best alternative stand to gain much more than just a short-term sugar hit of talent; with the right investment, a critical mass of high-skilled immigrants can kick-start new innovation ecosystems and create a new, more dynamic status quo.

Australia has every reason to compete for this prize. In fact, we are in desperate need of just such an opportunity for economic rejuvenation.

Our productivity growth, the only reliable way to raise living standards, is sclerotic. We now rank 27 out of 31 OECD countries, with the UK and US achieving three times and eight times our growth rate respectively. And with the future of our resource exports growing cloudy, the “lucky country” might be starting to run out of luck.

Jump-starting Australian innovation would give us a chance to break out of this uninspiring position and provide a path to a more prosperous future.

Frustratingly, we’re on track to squander this opportunity. While competing destinations have launched ambitious programs such as the Choose Europe for Science Initiative, backed by €500 million ($881 million), Australia has dragged its feet. A recent proposal to tax unrealised capital gains has spooked start-ups and their investors, and Labor’s ongoing desire to cap foreign student numbers actively harms our chances.

To reverse course and win the war for global talent, we require a bold, co-ordinated, “big push” strategy to ensure that Australia offers the most compelling alternative to the US as a place to discover scientific breakthroughs, develop technologies and build companies.

Our big push strategy should target the four key types of individuals that define the best innovation ecosystems: world-class researchers; risk-taking entrepreneurs; high-skilled technical workers; and promising young students.

We can target each talent category with two types of policy levers.

First, make it as easy as possible to choose Australia. For top talent and their families, getting an Australian visa should be a fast and seamless experience. Labor’s National Innovation Visa is a good start but is too restrictive; it could be significantly expanded, for example by removing the “invitation only” requirement and introducing a fast track for affected Harvard scholars. Supply side housing action to address the ongoing crisis, such as zoning reform, is long overdue to make Australia welcoming to new migrants.

Select new arrivals could merit limited financial support to smooth the transition, and for top professors who bring research affiliates in tow – think of the benefits we have seen from international researchers such as Professor Michelle Simmons basing their careers in Australia – tailored incentive packages would provide excellent bang for the public buck.

Australia has greatly benefited from international researchers, including quantum physicist Professor Michelle Simmons.Credit: AFR

Second, invest in the success of Australian-based innovators. For scientists, that means aggressively reversing the decline in R&D funding that Robyn Denholm, chair of the ongoing National R&D Review, has called a “national emergency”. Opportunities to fund “shovel-ready” research projects cut by the US are plentiful. For entrepreneurs and high-skilled workers, selective support for companies in high-potential or strategic sectors such as public offtake agreements can support the growth of new products and businesses.

These policies can be targeted at places where Aussie innovators have already proved their strength. Hubs such as Melbourne’s biotech district, Sydney’s SaaS (Software as a Service) scene, or the Gold Coast’s growing space industry provide natural focal points for new talent to coalesce and amplify.

Labor’s historic election victory has given them a rare licence to invest in a better, more exciting future. For Albanese and Chalmers, who have publicly committed to solve our productivity crisis, this opportunity to boost innovation in Australia couldn’t have come at a better time. They should seize the chance to do so.

Luke Heeney is a Master of Technology and Policy Candidate at Massachusetts Institute of Technology.

Sarah Davis is a Master of Public Policy candidate at Harvard University and an MBA candidate at Stanford University.

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