exported more than 750 billion in services. we also import products for other countries, import materials to create american products and imports give our families more choices and lower prices. from 1960 to 2015, trade rose as a percentage of u.s. economic activity according to the world bank from 9% to 28%. even though we're the world's largest economy, 80% of the world's purchasing power and 95% of its consumers lie outside the united states. our farmers rely on foreign markets to remain financially strong. in fact, one-third of all american farmland is planted for exports. american manufacturer's depend on foreign markets with about 25% of all manufacturing jobs in this country being supported by

exports. overall, trade supports over 40 million u.s. jobs or one in five in our nation. tens of thousands of those jobs are at fedex. trade-related jobs pay an average of about 18% more than nontrade-related jobs. in general trade has added $13,000 a year in purchasing power for the average american household. the second fact about trade. market access and ecommerce are changing the nature of trade. thanks to the internet and gobble logistic services offered by fedex and others, ecommerce is booming. worldwide retail ecommerce sales are approaching $2 trillion and are projected to exceed $4 trillion by 2020. while much of this is domestic trade, cross-border ecommerce

will unlock even more growth potential for companies of all sizes, especially small and medium-sized companies. let me just give you one great example of this just up the road. fedex customer ora gene technologies, they develop antibodies, plasmas used for se search. they employ 80 in the united states and approximately 5b worldwide. their network of international distributors reaches more than 35 countries. fact number three, the u.s. wins when we enter free trade agreements. the u.s. has free trade agreements in place with only 20 of our trading partners. contrary to public perception, the united states enjoys a surplus with those trading

partners in manufacturing and has global surpluses in services and agriculture. according to the department of commerce, our 20 free trade partners buy nearly half of all u.s. exports. on a per capita basis, these 20 countries buy 13 times as many goods and services as other countries. that's because free trade agreements remove barriers to our goods and services and make our exports more competitive. these free trade agreements are the solution to trade deficits, not the problem. american workers and businesses need agreements like trans-pacific partnership. it's an important step toward achieving free trade agreements between the u.s. and 11 other countries in the pacific realm. we're 100% behind tpp. this recently negotiated agreement will unlock more trade opportunities with these other

fast growing tpp countries. tpp represents more than 480 million potential customers for u.s. businesses. the agreement would eliminate 18,000 tariffs on u.s.-made products, thus increasing global demand for american made goods. it will spur greater investment in the united states, which correlates directly to new jobs here. our strong recommendation to incoming trump administration is not to abandon tpp but to improve it towards full free trade, which president-elect trump supports, with these countries. there was also a great deal of negative talk about nafta during the election campaign. but in fact, nafta is the linchpin of our current economic competitiveness. here is what nafta does. it eases trade among 450 million people in the united states and

our trading partners canada and mexico. nafta trade more than quadrupled in 20 years, which boosted the economies of all three countries. nafta has made the united states the centerpiece of a huge north american production platform. nearly 14 million u.s. jobs depend on trade with canada and mexico. economist gary hov baur estimates nafta makes united states $127 billion richer every year. u.s. private sector jobs have increased by more than 29 million, 32% rise since nafta began. of course nafta was written in the 1990s and the nature of trade has changed substantially, mostly due to the internet and the digital economy. modern trade agreements like tpp address 21st century trade

issues lirks ecommerce, cross-border data floes, enterprises, small businesses and global supply chains. all these improvements, plus others, in areas of labor and environment are included in the tpp. if president-elect trump wants to improve nafta, we recommend he start with these types of provisions, many of which have already been agreed to by mexico and canada as part of tpp. the new administration may also want to address the advantage that mexican exporters receive through the rebate of value-added taxes or vat on all their exports to the united states. we don't have similar rebates on taxes on u.s.-made goods and this puts our exports at a serious disadvantage. while nafta could be updated and strengthened as noted, withdrawal is another matter entirely. there are myriad reasons why that would be catastrophic for

u.s. economy but the main one is the nature of u.s. supply chains. few people understand how nafta that woven productive capacity of north america into one integrated platform. the united states, canada, mexico makes many things together. forty percent of the value of mexico's exports to the united states is u.s. content. the auto industry is a great example. it's been said that the average american car crosses the u.s./canadian border serve times during its production. a november 10th "wall street journal" article cited an example of four states and four nafta locations. nafta makes u.s. one of the most attractive manufacturing locations in the world because of value added productivity of canada and mechanic in one

integrated north american supply chain. if we could complete free trade agreements with asia and europe, the u.s. could, in fact, become the undisputed champion in manufacturing once again. withdrawal from nafta would have massive repercussions. thousands of u.s. companies would have to ship their supply chains at great cost and disruption to their businesses. americans should understand that pulling out of nafta does not ensure that production in mexico would come back to the united states. in fact, it's possible that many u.s. manufacturers would either find suppliers in other countries or use mexican production to export to other markets because mexico has 40 plus free trade agreements, double our level. we've talked about tpp and nafta but we haven't mentioned the huge economy that's part of neither of those agreements,

china. u.s./china relationship is the most consequential relationship of the 21st century. it comprises the two largest miss in the world. two economies that are highly interdependent. we have numerous common interests and challenges and many of the toughest global issues cannot be solved without sino-u.s. cooperation. for years the bedrock of our relationship has been based on three principles. first, that china's rise is good for the united states. second, that both countries must work together where we have common objectives. third, we must manage our differences carefully so they don't spiral out of control. those three principles are still valid and should governor our relationship going forward. both sides have to acknowledge that attitudes in the united states are changing towards

globalization. international trade and china itself. let's look at changing attitudes crystallizing in the minds of business leaders, policymakers and the public who elect them. no one can reasonably deny that china is joining w.t.o. brought about enormous benefits for china and overall the rece of the world. having china inside the global rules system will always be preferal to having them outside. chin's w.t.o. members has brought great benefits --

even so u.s. manufacturing output was $20 trillion in 2015. we make things today with fewer people, and that will continue into the future. in addition, it's important to note our trade deficit with china is really a trade deficit with asia and the vast network of asian supply chains into china. even if we imposed massive tariffs on china, much of their production would shift to other asian markets such as vietnam. tariffs on china will not bring back large numbers of low value added manufacturing jobs. training our workforce for the future and reforming our tax goal will grow high-paying

manufacturing jobs here in a truly open trade regime. protectionism will reduce them. but let me be clear. there are legitimate concerns about chinese mercantilistic and their industries while restricting competition. list of troubling china's economic and trade policies includes the indigenous innovation initiative, support of national champions, massive investment in state-owned companies. intellectual violations including cyber espionage and forced technology transfer. fedex has experienced protectionist policies in asia firsthand, so i know of what i speak. both japan and then china tried deny fedex our commercial rights. japan and china did this trying to protect potential domestic

competitors. many other western companies have faced similar forms of protectionism. prime minister abe in japan and president xi in china are well aware of their own economic challenges due to protectionism in their country. this is why prime minister abe has taken a strong stance in favor of tpp against significant domestic opposition in japan. in the same vain president xi has strongly support add more open and dynamic chinese economy with a more consumer-driven gdp. unfortunately progress to those ends in china has been slow as evidenced by recent increased support of debt for state enterprises. while it's growth in the last 20 years have been remarkable china is now approaching outer limit of investment and export-led mercantilistic growth. history shows china will not be

able to take the next more difficult step of transitioning to an innovative higher in come country. look at japan, it's mercantilist approach for so many years gradually slowedist economic growth almost to a halt. that's why japan avidly embraces tpp. a sustainable culture on innovation does not grow through government fiat, nor state supported acquisition of foreign technologies, brands and businesses while keeping one's own economy closed. instead, china needs to pull back from state ownership, reduce regulations, and move towards becoming a true free market system. here are three recommendations regarding china for incoming trump administration. one, make the u.s./china relationship a top priority to

avoid a downward spiral in economic and commercial relations that would harm millions of people. this is critical. peterson institute modelled impact on economy from full money trade war with china and mexico. the results are not pretty. it would throw the u.s. into a recession and cost us close to 5 million jobs. the president of both countries must commit to maintaining the relationship as we work through our differences. second, we need to focus on and increasing u.s. exports to china than restricting chinese imports. we need more trade not less. this requires trump administration to address both chinese and u.s. policies that in exhibit u.s. exports. of course we must be prepared to address situations where china or other countries export to the u.s. in violation of trade rules.

the trump administration has an extensive array of tools to apply in those situations. equally important, the u.s. should not ignore the services sector. export services jobs pay wages that average 20% higher than the united states average. the u.s. enjoys a huge comparative advantage with the services trade surplus of over $250 billion. private services account for about 68% of our gdp but only about 50% in china since so many important service sectors are closed. opening these service markets will help china achieve its own economic objective of moving from export-based economy to a more consumption-based gdp. the bilateral investment treaty the u.s. is negotiating with china can give the trump administration its first opportunity to get a better bilateral agreement and help

china achieve its internal market for foreign gold. third, we need to enforce our trade agreements and address policies that penalize u.s. economy and our workers. of course, we must always act consistently with u.s. law and w.t.o. rules. after all, as the u.s. has been the primary architect of u.s. based system since roosevelt's administration. it's important to realize blanket tariffs imposed across the board are not the right response. such tariffs will erode support of global rules-based system and release protectionist mentality around the world. china should understand that under a trump administration there will be stronger more rapid consequences for closed door practices. how china reacts will be critically important. all the while we support president xi's stated commitment

to a more open chinese economy. to these ends, we hope the trump administration will take another look at tpp and realize not only its benefits to the united states but also the consequences if an improved version is not approved. tpp is bulwark against current chinese practices and china is aggressively moving forward with its own trade agreement in the region. the rcep or regional comprehensive partnership. many countries said without tpp, they will have no choice but to move closer to rcep. we urge the trufr administration to put a stamp on revised tpp by addressing any concerns it's sees and making any additional improvements to promote trade rather than restrict it. we hope trade negotiations can

be picked up and strengthened under trade administration. the two most important of these are trade in services agreement or tisa and transatlantic trade and investment partnership or ttip with eu. trade facilitation should be another priority. we've been promoting this for year w.t.o. trade agreement has been ratified by 102 countries and needs only eight more to come into effect. this will reduce customs and administrative costs by up to 14%, which is significantly more than the average global tariff. finally i would note trade promotion authority or tpa congress recently passed has a detailed list of all the areas where u.s. has a comparative trade advantage. we need to lean into those opportunities rather than walk away from them. finally it's important to

recognize u.s. success in the world economy depends on three other changes. first we have simply got to overhaul our corporate tax code. our 35% corporate tax rate is one of the highest in the world and is inconsistently applied across industry. in addition, the united states and chile are the only two -- the only two major economies with a worldwide tax system. this means we tax earns u.s. companies anywhere in the world making our good more expensive overseas and our companies less competitive. we need a territorial system like every other advanced economy. this combined with lower corporate rate will resolve many of the disadvantages i've talked about today and that were so central to the recent presidential election. a lower corporate tax rate in a territorial system will equal more investment and higher investment means more, better

paying u.s. jobs for american workers. second, we must train our workers for innovative jobs of tomorrow. a mckenzie study noted a few years employers worldwide could face shortage of 85 million high and medium skilled workers. we should strengthen our trade adjustment to provide for retraining of workers impacted by global trade and automation. a large number of those jobs of stay in the u.s. if we adopt the policies i've mentioned today. infrastructure. unless we make improvements to roads, airport, other facilities, we'll lack the capacity to handle a growing economy and global supply chains that supported them." our federal and state

governments must work toward modernizing infrastructure for massive competitiveness. trade has made america great. standing trade has been a bipartisan pursuit for over 80 years. the failure to continue to do so would be a big mistake with continuing consequences for america and the world. thank you. [ applause ] >> i started off by saying the prbt won't like his report card. a lot of fs, ds, not too many as on there. i think the important thing that we're trying to highlight in the clarion call, that there is a way forward. when you look at where the

economy has been, this is really about accelerating gdp growth. that gets down into two components. that is how many workers are participating and what's the productivity we're deriving out of that. a number of areas we're looking at in the clarion call, whether it be education, which gets into really developing the workforce of the future, whether it gets into assuring that we do start handling the debt, which makes it sustainable. whether it's continuing to invest in r&d, important to the innovation set of this, which drives productivity piece. there are a number of areas we think are very, very important we set a direction going forward. you can prioritize which one you work on first. all are important to assure the country is growing at a

sustainable rate over a long period of time. >> what i love about the council in general and this panel is we have so many different backgrounds in industries and academia represented. mahmoud, from your perspective, what are you looking to accomplish on behalf of the council and clarion call? >> as i'm sure you've seen in the clarion call, when we think about opportunity for growth, there's still a lot of exciting opportunity out there. let me just take it from a technology perspective for a second. let's start with productivity we've had. we think about what everybody talks about, the confrontational power of microprocesses has gone to be doubling every two years or so. it's been an amazing few decades. that slowed down. one way of looking at it, the growth has been done. yet exciting technologies coming just around the corner that can jump-start again and give us another s curve. that's exciting because it's

another wave of growth. it's not just exciting from an economic point of view but also it's important from a defense point of view. as many people in this room know, our military needs secure state-of-the-art microelectronics. in fact, the last defense bill required the secretary of defense to make that available by 2020. so a whole cluster of capabilities there. if we look beyond there in the more consumer industry engineering in general, we've got the internet of things. everybody is talking about it. everybody is starting to experience it. if you think of the capability of sensors, big data analytics and the ability for communications between devices, we are living that only the surface right now. it's going to change the way which businesses operate, businesses use their labor force. the way companies like mine at

pepsico engage with the consumer. we have an exciting wave of this coming, this link between individuals with machines and machines with other machines. another area that is generated from this as you now take internet of thing, artificial intelligence, and now link that to robotics, look what's happening in manufacturing. we've seen a wave of that in manufacturing but driverless vehicles just another example. not only cars and automotives everyone is talking about but even around the potential of airplanes. i'll touch on that and in the end we have to be conscious that means a change in our workforce. we have a very large workforce that is part of transportation. what are we going to do with that as that technology and growth comes? and the last piece i left at the end because that's my background and i have a lot of passion for it is the opportunities coming

in biotechnology. if you really think about what biotechnology has done, a human it took 2 years and $13 to sequence the first genome. now you can do it in 24 hours for about $1,000 bucks. it's going to get faster and cheaper. what's the implications. take a technology like crispr, where a scientists can go in, very precisely edit a genome sequence in an organism. it has profound implications when used for good. let's take an example. somebody born with inherited disorder because of inherited mutation, the ability to go into their bone marrow and change their stem cells or go in and identify a plant variant more drought resist ability, higher yield, pest resistant because we can select certain genes.

that is revolutionary. remember, we have to feed 2.5 billion more people in this planet in the next 25 years. in closing on that part, i would say, look, lots of these -- these are just examples. one thing we have to do when talking about technology we cannot leave large parts of technology behind. technology has to lift everybody. as multiple stakeholders we've got to engage people, talk, discuss, agree on what's good for society and invest behind it. i'm very excited for technology and that's where our clarion call it pointing out. >> it's going to be up to you to train all of these technological advances. from your perspective, what do you hope to accomplish this year? >> the first thing to point out, this is a tremendous country. we've been tremendously competitive decade after decade. we've done things unbelievable in the annals of human history.

what we have come to is a point where we're having difficulty managing the forces that are required to be as competitive as possible. there's really three things at work. one is the overwhelming force of creative destruction where every new idea replaces a new idea, every configuration replaces a new configuration or system. in that, if the citizenry isn't capable of making those adjustments, then more and more will fall back. while we'll have fantastic achievements in some sectors, we'll have generally a weakening competitive position in our overall economy, which is the case now versus previous decades, and we'll have a very negative set of impacts in terms of people being left behind. so what's happening now we haven't matured enough. our eye is not on the ball. these rates of change, as we just heard, are so fast that

rather than taking three generations for a change to be implemented, there's five major changes in a single person's life. five transformative things that would affect a single individual. what that means then we need to dramatically enhance focus on the ball. focus needs to be on the continued development of ideas. underfunding the basis of from which these ideas can emerge. lots of other people stepping up, other nation states, other parts of the world. we have been stagnant and not moving at the speed we should be moving. i place that as secondary issue to principle issue of people and people development. we have a poorly articulated, poorly developed and very weak immigration policy on every front. the country built on the nation of driving forward, driving creative destruction forward

through immigration. education and training of new immigrants and citizens, so that's something that needs to be worked on in our report. that gives a poor grade for our policy and all that i think the i think we're not doing we're arguing about super silly things right now. we're arguing about what's the role of government in this, what's the role of government in that. the government has always played a role in the preparation of the workforce by investing in the next generation through schools and through universities and so forth. we've literally, literally -- we're so far off the mark, so far off having our eye on the ball, not through the resources allocated but through the mind-set. we don't realize that everyone has to graduate from high school. if you're not graduating everyone, the entire system is a failure. because those people will not be employable. they will become wards of the state. they will be concentrated in nothing but income tax transfers.

we need new schools, new ways of thinking. new ways of moving forward, new ways of organizing universities, et cetera, so that we can find a way to actually produce. individuals have the capability of being competitive themselves. competitiveness is not only a function of the national net competitive outcome, it is function of the algorithm of derivative of the individual's competitiveness. so we have far too little focus on the individual and preparing the individual to be competitive. i passed an uber test vehicle in phoenix the other day. there was no one in the front seat. it was driving. there were people in the car no one was in the front seat. i was at a meeting in morocco a couple weeks ago where a guy stood up from a major technology company in the united states and said, what we need to do is replace 3 and 12 million job of people in the next 10 years by people displaced latest changes of computational technology,

artificial intelligence and decision making systems. are we prepared to do that? he said, no, we just need a tax system to give them money so they have something to eat. well, that's nuts. we need competitive individuals clustered together, advanced through lifelong education, who can continue to be competitive at higher and higher and faster rates of change and that's the algorithm we need to figure out and we haven't figured out. >> debra, how do you tackle some of those challenges and goals and turn them into reality? >> well, i think one of the most important things about the council's clarion call, we've been issuing this for a number of years, is we recognize there's not one silver bullet. this is an integrated system. and if we can really make progress in partnership with public policy leaders, congress, really with the leaders in this

room from all sectors, we can tackle some of these. we really have to look at this going forward all front. yes, we can get corporate tax rate down to a level comparable to competitors. finally a recommendation we've been calling for many, many years is move to territorial tax and get $2.6 trillion that's overseas back into the u.s. at an appropriate tax level. we can make progress also on some of the issues around our regulatory burdens. but the things my colleagues have been talking about, these are our competitive advantages. so i think the message i really want to convey is let's get our house in order on the things we can do that put us right now at a disadvantage to our global competitors around tax and the debt and regulation and just turbo charge on these competitive advantages around the technology transformation and the people in america.

>> i wonder, sam, if the improved growth outlook debra is referring to an some of the pro growth policies that are set to come in action, the stock market at a record high, helps tackle some of these more structural issues. in other words, if the growth is the medicine that's been missing over the last few years, which has made it so hard to prioritize some of the issues you're talking about. >> i think it certainly will be an enabler of bringing people together. i think some of the stimulus that's being talked about, that does not create long-term sustainable growth. what it certainly does is turbo charges in the short-term. and when growth is stimulated in the short-term, that makes it a little easier for everybody to come together and say, okay, how do we work together on this long-term problem, ones we've been talking about. i think the important thing for people to recognize, though, is,

i mean, you can change the tax rates, do all those things, that will drive a spurt in the economy but you have to change productivity equation long-term if you want loan-term sustainable growth. so it will be very important, and that's where the council can help, i think, in making sure everyone is focused, okay, how do we tackle the big problems, things like what michael has talked about while we are experiencing this near term stimulus that's brought about by the changes that are sure to come with the next administration. >> i was just going to emphasize, look, i touched and talked about the exciting opportunities of technology. i want to come back to what i ended with. if we don't deploy all of this exciting opportunity in a manner that lifts everybody, then we're going to have a worsening of where we are today. looking at it purely from food industry perspective, there are about 50 to 60 million americans today that live on subsidized food, food

stamps one way or the other. that's about one in five americans today. if that part of the population is not given -- not just financial means and subsidies but meaningful work, people don't just want to be given a hand out. i don't care if it's government or private sector they want to be engaged participating in society, having a voice but also contributing. that's part of what we are as human beings in any society. i don't care where you are. that needs to be focused on. it can't be done by any one sector alone. what the council is doing is pointing out gaps and proposing real pathways forward of how multiple stakeholders, everyone in the room working together. i think that's an important point michael is raising. technology is an enabler, it's not a destination.

>> where do you find that countries are outfront on this, michael, globally looking around the world as we look to a loss of competitiveness as you described it? who do you think our chief competitors or rivals we need to follow? >> there's lots of competitors and i think the nature of competition is good. competition produces better ideas, better products, better outcomes, economic growth, economic enhancement. we've got rise of asian tigers, fantastic competition coming from some of the countries in europe. stabilization going on in some of the markets in south america. a whole new conceptualizations. back from the middle east, thing going on there, all positive, positive, positive. the problem we've got is we're the rich family in the big house down at the end of the street that everybody now looks at and says, what's going on in there? meaning there's a lot of arguing going on in that house, a lot of stuff going on. so the thing we have lost, i think, perhaps compared to other is we've been coasting. we've been coasting on the

investments of the past. we've been coasting on the steps of the past. we are unbelievably competitive launching missions to the moon and doing things that were going on in the 1960s and moonshot mentality and projects and achievements and all kinds of things. we can do all of that. what we haven't done is we haven't figured out yet how to help every individual to be competitive. if you live in the united states today, and you have only a high school education or less, there are nearly 25% fewer jobs for you than existed just prior to the recession. if you live in the united states today, and you're of european descent and you're a woman and you have only a high school education, your life span is going down. if you're in the bottom third of the american economy from an income perspective, 110 million people, something on that order, in that bottom third, you have no positive indicators. life span going down, educational attainment going

down, incomes are going down. family stability going down. there are no positive indicators. if we don't fix that, i'm not talking about fixing it from social engineering perspective but i'm talking about fixing it from a competitiveness perspective. there won't be competitive enhancements in the united states. you can't have a third of your population that's noncompetitive and hope your country will be competitive and that bottom third at one point will destroy or kill everyone else. so it's something that needs to be fixed. it's not something that's going to lead to competitiveness. >> how do you do that, debra? are you more hopeful as you describe a public/private partnership that at least we're coming out of some years of gridlock in washington, d.c. theoretically we shouldn't see it as intensely as it has been over the last few years. >> well, i think we're very optimistic at the council on competitiveness because of the people we have that are in our organization and our extended partners to really begin to

tackle these very deep structural problems, but also the opportunity. i think we have to always be looking at the opportunity before us. and certainly now when i look back at the beginning of the council and during my time, we've just seen a plethora of -- >> venture partner at gva capital group, on the disruptive business models of intelligence, impact on society, enterprise, people and investment. >> thank you very much. it's a great privilege and honor

to be here. we have in our panel, some esteemed panelists who are coming from the world of research, collaborative sciences as well as venture capital and business. so it is a great pleasure to do this topic of artificial intelligence at a national level. i think this is the perfect time to conduct this as a national level and i want to thank council, i want to thank debra and all the council leaders for giving usa chance to present artificial intelligence. what i would like to do is for the panelists sitting here, roy and daniella, i'd like to mention several facts why this is a tipping point where artificial intelligence is today. the tipping point is you see a lot of people are talking about artificial intelligence as the next internet revolution. it is absolutely the next internet revolution. it's very pervasive.

not only that, we're now seeing, according to some of the economists and people from china, for example, they are saying this is the next electricity. this is the next energy. why this is all happening. the level of investments in artificial intelligence has been really very high. and we're now seeing a huge potential of all of the ai hardware and software reaching approximately $47 billion by 2020. that's a huge step up. we see enormous, enormous opportunities in the area of startups, especially in silicon valley, but in many ecosystems as the panelists can vouch around the world. so far there are over 1500 startups across the world that are leveraging artificial intelligence. that's not a small number. you look at the information, for

example, ibm watson back in 2011 was simply focused on basic machine learning, not deep learning. now they have 30 components focusing on deep learning today. google with only a few deep learning initiatives several years ago. but today they have more than 1,000 components in the space. we're seeing business models being changed, totally transforming the industry, totally transforming the world of academia and research. this is now entering a stage where i just came back from g-20 in germany. it is a high topic on digitalization task force focusing on artificial intelligence. because as you know, digitalization alone major impetus for growth around the world. additional 20% of growth in artificial intelligence will probably lead to 1% growth

worldwide. that's why it's critically important, and that's why we're having this discussion. so with what i'm mentioning regarding all this information, regarding the internet of things right now, they are basically saying it creates a value of over 1.9 trillion by the 2020, 2023. the numbers are enormous. we were just few years ago, again, from venture capital perspective playing with only 200, $300 million invested in artificial intelligence. but now today, we're going to close the year of probably close to a billion dollars invested in the space. we have with us the managing director of bloomberg data. you have ventures and other groups, intel capital heavily, heavily investing. in the next several years, we anticipate investments will be at $5 billion in artificial intelligence. so with everything going on,

we're on the cusp of major revolution. the models are going to shift. let me be a maverick. i think some companies won't exist because of what we're seeing. i will pose a question first to you, daniella, what do you see in terms of the perception and are we reaching the point right now where our economic models are going to shift and change and what do you think the future will bring to the united states? >> so it's a privilege and a great honor to be here. thank you for this great question about our research area. i would say this is an extraordinarily exciting time for ai. a lot of the tools we as a community are developing are maturing. this is due to great advancements on the hardware side. we've heard about moore's law

today but similar exponentials are happening in other aspects, in the quality of sensors, the quality of the motors that we have available to us, in how we communicate. practically everything about the digital space is subjected to moore's law, to an exponential. in addition to that, as community we have made tremendous progress in how we solve problems. and the third reason is the event of data. we now have the ability of collecting enormous amounts of data that help us learn how to do things right. when we cannot write from scratch algorithms that will solve those problems. good hardware, excellent algorithmic support, tremendous amounts of data are all coming together. there is a confluence that enables all these things to come together to deliver capabilities we never even imagined even five

years ago. so five years ago, nobody was talking about self-driving cars. today it's inevitable that we will have self-driving cars. all major car manufacturers have announced self-driving car efforts and we really expect this technology will come to bear and will bring us safety and will bring us more efficiency and lower impact on the environment. these are all tremendously exciting possibilities for the future. >> thank you very much. cynthia, just to follow up on that question, what are you seeing? you heard all the facts. we're hearing media tremendous potential, tremendous growth from the investment to revenue potential in artificial intelligence. what are you seeing in the area of robotics in artificial intelligence? specifically i know that you're also involved and founded a

robotics company as well. give us an impression how you think it will change the business models and impact the united states for tomorrow? >> sure. i would definitely say we're at an inflection point of ai. it's really not just about the technologies we talked about, advanced to the point where you commercialize the systems but when i first started working the field, it was a case where you had large corporations, advanced technologies speech recognition, machine vision. you take it, millions of dollars to develop these technologies and they would hold them close to the chest and productize their products based on these core technologies. what's been happening more recently on artificial intelligence, those tools and ability opened up to sdks. third party developers can take ai techniques and put them into their own products and services. as ai starting to happen now you see many types of advices to

exhibit artificial intelligence. that's recent. now we talk about google and microsoft services and watson and all the big companies are starting to do that. the way that impacts a company like you would have to build all the intelligence into the machine it and it couldn't really change unless it was from its open learning, but now that it's connected to the cloud, you have this ability continue the upgrade the content, the cape bableties, to continue to have, adapt new ablties and now as platform, you're able to have much like the iphone. a whole developer community of people now able to create applications for robots, where they might not necessarily be the person's skill, but through the tools and technologies, they're able to create, so it's absolutely transforming how robotic products are starting to be commercializeded and creating

new revenue models. this idea of this iphone platform model is quite new, but you're starting to see a lot of companies adapt that. >> thank you. i know my own daughter is very much attached to alexa. the new product that came out of amazon and many of you have seen the beezus and his team, you were speak about the relative democraticization of the tools in the space of artificial intelligence, they just released a bunch of tools so many developers and many end users and many research facilities and executives would be able to guide their teams to develop ai applications. amazon web services have done this. intel has done this on the hardware side alone. ibm is working as well, so, right now, the structures, even so we don't have the major models in place, or standards, there's a whole serious of democraticization taking place now and it is obvious some of

the major players. roy, thaupg so much for joining and bringing the ven chu capital perspective. you're one of the leading players vest investing in artificial intelligence. over several year, we have seen major players from facebook to google to microsoft to ibm, really buying out ideas, buying out start ups. people who are is visionaries, leaders in the space, there has been over 150 ak wii sagss, 40 just alone this year by the corporate venture community. where do you see this going? what's the end game and where do you see the convergence of venture capital and artificial intelligence? >> we invest on behalf of bloomberg. companies that influence the future of work. we did not think about artificial intelligence. six months in, one of my

partners said we should start looking at this thing and at first, i dismissed her and said, you know, fine. you want to work on it, be my guest, but it's your time. three for our months later, she came back and found 2,000 start up, we prefer the term machine spell jensen because it con vurs up less of the science fiction nightmare. my job to help them plug into the power, so we play a role late in the process. large corp. races. start the chain of invention and we're just delivering the last mile. so, for venture capitalists to be excited, it means it is almost ready. now, that said, i think it's early. the conversations we're having now about machine intelligence are similar to the ones about the internet in 1997. if you remember that moment when everybody started saying, well,

what's your internet strategy. they hired people with trang titles like webmaster. the tools are beginning to demock ratize. the acquisition so far has been a blip relative to what will happen and we look at it at first, we said maybe this trend of machine intelligence as otherwise people might be able to do, maybe it's as big a trend as mobile. trz we said, well, no, it seems bigger. maybe as the internet. actually, i think it might be as big a trend as all of software today. i think that's because we've been waiting for the promise of the quinds of inventions we'll see now.

>> the chinese were saying they are creating funds, specifically related to artificial intelligence. one is alone, has put together over 2$200 million fund. this is happening right across china. investments are very, very important. for us to make sure our start up committee and to make sure we're reinventing our future and keeping our leadership position which i think we should in the united states, what do we do? >> i think venture capital is a rounding error. much more important the government investment. and large corporate investment in riskier research. we receive the end of the pi pipeline. the first year, we got a bunch of calls from academics who said oh, i've been working on this, thank you for finally see it. the second year, a bunch of

calls tr from investors, who said oh, last year, i saw what you did and now, i want to put money into this. this time, the wave of calls is from the fortune 500. so we have big, multinational corporations and not the ones with who had the technology skills invent as ibm, google, facebook. but every company's saying wait a minute, i need to do something about this. so, if you are part of the leadership team, you ought to be asking what's our strategy. just like with late '90ss with the internet. many companies will blow billions of dollars on foolish ai investments before we figure out what to do. but we'll probably have to go through that phase. but then i think we have 25 years ahead of us of incredible dividends for human beings. >> i think we need a solid ecosystem. can't have venture capital sticking out. you need corporations and well funded research. especially at the government level to make sure that we main

tape our ver competitive position as you know u.s. is very competitive in this space. next are in the nordic area and sweden and other places. >> i don't know how competitive is u.s. is. for what it's worth, this is an area where canada was focused on this issue for decades while the u.s. was asleep at the switch. china seems more focused on this issue and i think one of the ibs with we have and where a group like this can be helpful, as an industry right now, we lack strong high poth cease about where employment growth might come from. we have lots about economic growth, but actually think this is a warning call to the u.s. which is not the leader on this issue right now. >> thank you. i would like to jump in to add and say i was in china in august at a meeting where the governor of the province announced $500 million in robotics research for the province along.

guan dong province. it's amaze, it's wonderful. it's at $30 million a year for the whole community. >> you know the amount the u.s. spends annual ly on ai research? the president releaseded a report, ai should be important and the number was a billion dollars. it is nothing. we need at least 10 x. >> i think it should be a public private partnership. we need government, families, more institutions just coming back to you, i was in slovenia alone, they have invested heaviry in a lot of the artificial intelligence research and people. but it's not everybody's looking

for talent, how do we bring this talent into the united states to develop market ready solutions and products? >> so, i would say we have a lot of talent at the top universities in the united states, but it's not easy for students who graduate to remain in our country and give back after their training because they do not get a visa. it's difficult for them to get a work visa, so i think we need programs that enable our students to kopt to stay here. many curran and help build the local economies there, so we have to do something about that. zbh yeah, thank you. we are at a point where industries having created. there are first movers seeing in technology world, what google,

what facebook is doing. can you share with us your experience in robot, but also in the consumer space, which companies right now are the first movers and what business models forming as well as enterpris enterprises? what is research doing to -- zwl i want to raise the tupt of artificial intelligence in education, so many of these questions around talent and opportunity, again, we hear this theme of quite a lot this morning. artificial intelligence offers a new approach pau bring potentially high quality education for everyone through we need to start tapping the problem at early childhood. showing the critical neural foundation that even if you start kindergarten behind, it's

very hard to catch up. artificial intelligence and these technologies offers an opportunity so you can learn at home and not just as school. so augment what teachers do. i see this as an area of critical innovation we need to take seriously. now, in terms of the kind of leaders in the area robotic, i have to say, clearly, there are a lot of really profound movers in the space depending on the area of robotics. agricultural. medical, transportation, cars and so forth, but i have to say, the united states in terms of these first kind of bold companies still is producing a lot of the most innovative products and models. even in my own sector of personal robots coming swoot into the home, we did a crowd funding campaign to raise kind of venture capital and that stage. you had to put your idea out there. there have been so many copy cats out there.

often the invasion is being started in the united states and i would like to see the ability for us to own that instead of being taken over because there's so much more investment happening in other parts of the world. >> thank you. there's been a lot of talk regarding autonomous intersurprises. what makes enterprise autonomous. some talk about self-service, neural networks. maybe you could talk about some of the examples and what you're seeing in the autonomous enterprise space. >> a company that runs itself. sounds like a good thing. we tend to invest in things that are very mature. a very tang bable example. a company called textio.

before you u publish the job description, it analyzes data about past job descriptions to predict the quantity, quality and gender mix of applicants and lets you edit your job description to maximize the potential results in the world. the reality is they're using straightforward, well understood learning techniques. we invest in orbital insight and estimates the size of market, so, for example, they can proximate how quickly is the chinese construction market grow ing by counting the shadows on buildings. the question is raise ss what happens to the experience of work and jobs together with new america bloomberg has been driving a project called the shift commission to study long-term scenarios for work in the united states. and i think the self-driving

truck. some fascinating results, but the self-lending officer, the total number of jobs is not really the issue. because a balloon doesn't pop because of pressure overall. it pops because of a pin and we have many, many different progressions across the united states where there's some risk of change. so whatever industry you're in i think there is some ai application that is coming for you very quickly. >> just because we're running who on time and i want to get into this area of the dark eric side. i believe that it will create lots of jobs in cybersecurity.

we're stepping up on valued creation and looking to solve problems. we are stepping up in kraegs, we need to have people who are going to be architect, status igs, but i understand gart ner and forester put out stalt statement that is the press is p picking up, that there's going to be 7% to close to 14% job loss by 2025. in a lot of areas and roy, you've done a lot of studies. >> when we debate these thing, we have a point prediction about what will happen. the reality is human beings are terrible at prediction. the reason we're doing scenario planning for the future of work is to try to prepare for a wide outcome of scenarios. >> i apologize because of the shortness of time. and i just want to jump to daniella for some comments regarding the job loss or opportunities in the space. >> i see ai as a vector for

tremendous positivity. i see ai improving the quality of jobs in other words, consider any job. its repetitive aspect can be done by a machine. not just for truck drivers and other jobs that are really obviously in the line of machines. so, i really see a huge opportunity to bring safety, to bring cust customization and joy. because if you have a machine that does all the routine part of the job that you might not be excited about, you might have more time to focus on what you're interested in. >> there has been a lot of talk privately and also media discussing ethics. they're trying to scare us in fact to say that the ai world could be atz trosk to mankind

because they'll be smarter, the machines waterboarding smarter than human beings. heard that discussion. i had several friends from google say thag this 20, 30 year, we're going to attach our brains and we'll scan all this information almost like what wee doing with phones, so they're predicting the scary future, but i'm not sure this is the future because wee talking about applied ai, not creating a conscious machine and i want to get your feedback and your perspective on the ethics issue and where we're going with ai. >> yeah, i think the primary ethics issue is making sure that the ai we create truly benefits everyone. if you hook at the application, one of the big reasons i keep coming back to education, for me, that's one of those areas

where ai could benefit on the planet. within a specialized domain, we can create an ai that can perform better than a person. these ais that do one thing, that is all they really do. the new dialogue that's happening is the collaborative aspects. it's ai that works in conjunction and partnership with people so that the human ai team is more proficient, more productive, more successful than either the ai alone or the human loan and that's where a lot of the energy is going, so i don't see the doom and gloom. i see us p being augmented and being able to lead successful and fulfilling lives because of the partnership. we have to get it right ab that's when you get back to the basic verge and the application of that research. >> and government support for economic security for individuals. 100 technologists released this

project. to call for exploration of the idea of a universal based income. because we think we need some complime compliment. >> thank you and finally, one quick, brief answer from each of you. how does ai impact globalization? there's been a lot of discussion about outsourcing. we're at a stage where we're leaving automation and going to complete autonomy and how does it impact developing countries, how does it further grow our economy? what is your take? >> i like the idea of cust mization. i like to think about how we do manufacturing today where someone designs our products and they are manufactured overseas mostly. so now, imagine that we replace that process with a customized process, where we have customized templates for various

products that people could customize and that then get produced in a local factory and this could impact the u.s. and every other country on the planet. >> thank you. >> in terms of globalization, i think in terms of the empowerment, but also of the individual. so ai offers the opportunity for deepization and empowerment so services that we have to go to, industries and corporations for, going to be able to come at a personal level to the homes. whether it's finance planning, education, health care, i think we're going to see the empowerment in a new way and i think that would be a global way. roy! sorry to end on this, but not sure i have anything useful to add. i don't really consider myself an expert in the u.s. >> america first. >> i agree. what do you mean? >> where less than globalization. >> i would say that the first

mover thing is wildly overrated. we need when these things work for them to benefit the united states. but i don't care who's first. >> great, i think this is an exciting time and i believe this is our future. i think we as american entrepreneurs, american businesses, american research should be investing a lot more because this is a space chakd make a difference for the united states and the world and we've seen today prospectives coming from the top academics and research as well as prak tigs ners and financial capital and thank you very much for listening and being part of the future because i think the next time we meet, i think we may have intelligent agents that will guide us to this meeting, to lunch. we'll schedule things for us. it wouldn't be that very cool future for us and i truly hope that it happens very, very soon. thank you, everybody. >> next, leaders from industry

and national labs will showcase exciting, potentially game changing innovations. ladies and gentlemen, please welcome the director of pacific northwest national laboratory, dr. steve ashby. >> good afternoon and congratulations on your 30th anniversary. very happy to be part of this. as we clear that so hopefully, we don't have a tripping hazard. i think it's appropriate i'm following the sessions we had earlier talking about the grid. talking about machine intelligence and really about bringing those together. what i'd like to talk about is energy. it illuminates our night sky. it warms our homes and powers our economy. and thank you. and the united states, we use a tremendous amount of energy.

about quads of energy each year. the department of energy's national laboratory, we're working hard in partnership with academk -- to ensure we have th clean, affordable and reliable energy that we'll need not only today, but into the future. another part is looking how we can make greater use and better use of the energy we already produce. that's important because when we look at that 97 quads, we waste about two-thirds of it in terms of waste heat and other inefficiencies. let's put that in perspective. what would this wasted energy do for us? >> it would power the rest of our hemisphere for the entire year. the entire immediate as africa. if we can find better ways to be

efficient, we can say that energy, save money and reduce outlay frs plants. i want to taukt a what we're going doipg in collaboration with many others to increase energy efficiency. see if we can get it here. there we go. and particularly, i'd like to focus on our electricity usage. we use lek trelectricity for va of things, here, you're seeing a montage of things ranging from lighting, h vak, the it equipment we have in our homes and factories, a whole variety of things out of the 97 quads. we have made tremendous progress when they're running, the next challenge, is can we infuse them

with some of the sbel jerngs some things we're doing here, so not only more efficient when they come, but they know when to run. to know when to avoid peek, low times. what's that we're doing at the laboratory. voltron. an innovation we've come up with really combining some of the technologies we have today for controlling appliances and technologies. from building to campus to regional scale and infusing it with intelligence. so, what is this device? a combination of the real smarts. running on a lightweight comp e computing platform, such as

raspberry pie and made available through u open source, so our partners can download it through the website and use anytime a variety of different plaixs. one of the things we're able to do is partner with different people to explore the ways vol tron can be used. we're also partnering with people to adopt this technology. what can it do for us? >> hopefully move the slide forward. what we have here is we can use that technology to within your building to control appliances or devices. here, we're just showing an hvac unit you might see in your supermarket. to control that, a series within the building, a buildingist itself, so you know have a smart building and cap or region. more than just that, you could have a talk to the grid. in a two way fashion through

trans active control. which enables the energy, which makes the power of the spark grid a reality. so, this helps us do that. what you can see is that in case of the refrigerated display case, in partnership with emmerson ran an experiment and show that if you use this, you could save a tremendous amount of energy, o think about the refrenlg rated display cases. they have a defrost cycle. presently, that just runs every so often. when it run, it's very efficient, but runs a lot when it doesn't need to. suppose you have environmental sensors that brought in the data stream to voltron and told you when you needed to defrost it.

that's what it allows you to do. it can control that. 75% you could save enough power for 200,000 homes. another project we did with a company, transformtive wave in western washington, is looked at retro fitting voltron into a line they have and using it for rooftop hvac. up to 50% savings on that device, not buy iing a bunch of new equipment, a retro fit of that into a product they're already offering. this is the of this technology where you're infusing in terms of i trt to bring together to m these things really smart. now, that's what you're doing to control a single device or a

piece of equipment. also do that throughout your building and make the building smart or you can look at what you can do in terms of a campus. and that's what we're doing at pacific northwest national laboratory. here, we've installed voltron in nine different buildings with a number of devices connected to it and we actually manage this and look at the whole campus now and we're going to control our energy usage, optimize it and actually make the laboratory itself a test bed for demonstrating the power of trans active control. here's an example of the control room we use here. we look at this what we have. that's what we're doipg at the laboratory. in addition to that, woops. we also have partnerships going on with the university of washington. and washington state university.

they're yoougz using voltron in different ways. university of washington is looking at using it for solar technologies. washington state, large scale stationary storage and they're doing independent study, what we're now getting funding from, the washington state clean energy fund is to bring that together into a single regional demonstration of the power of trans active energy, where we can manage our loads in real time and watch the signals we're getting from the grid. we're doing that in the northwest. we've now been partnering with colleagues in ohio at the university of toledo where they're also looking at this with respect to the corporation of renewables and stationary storage and they're doing their own demonstration and our plans in the future is to link that at a larger scale.

here in washington, d.c., we have plans to go up to 150 within the next year. so, here what you're seeing taking a simple idea a lot of smarts in terms of the -- and working with with people to understand the different applications we could have for this technology. and making it available to our partners so they can integrate it into their existing product lines and new product lines. we've demonstrated the ability to save a huge amount of lex tristy. and save consumers and building owners a lot of money in the process. and so, we'd like to do here is invite you to join us looking for different ways in which we can exploit the voltron platform, how you can develop those applications for it or if you're a company, the product line, talk to us about how you can incorporate it into those product lips so we can have a bigger impact.

and exploit that to save money and energy. so thank you very much. please welcome senior vice president at vance technology and chief technology officer rockwell automation. >> good afternoon. in my ten minutes, i'm going to highlight some of the exciting manufacturing opportunities. it's an an inflection point for realizes unprecedents productivity from a lot of the technology advances that are occurring around us. so, if you look at all of the different technology advances, if i can only advance the slide,

so when you look at the different technology advances that are impacting us, everything from u bik wiitous connectivity, machine learning analytics. we heard a lot about some of these technology, just a few minutes ago. regarding artificial intelligence, machinery. well, the excitement in the manufacturing area is around industrial internet of things. you've seen projections that by 20 2020, there will be 50 billion dwigss connected to the internet. out of these, roughly afthalf w be in the industrial space. fz companies like cisco and mckenzie have put out new numbers and that's around $15 trillion. just a smidgen less than our national debt. so off these $15 trillion of new value 27% is expected to be in

manufacturing. that's the largest segment of the benefits industry from industrial internet of thing, so that's pretty exciting. if there really is roughly $4.5 trillion of value to be b created from industrial internet of things, how do we go about it? what are some of the impediments? i'm going to talk about not just the opportunities, but what are the areas where more innovation is needed? where more tall ept is needed and better policies are needed to move forward. basically, what the connected enterprise means is bringing together data from your production site, manufacturing sites with your supply chain, from your customer demand

inputs, so bringing them together and thep optimizing productions to get the most value. we started with the enterprise roughly about six, seven years ago. we started out by rolling out any rp system, which a lot of companies are tone in the past decade, then it's not just the erp system, but we started transforming the process. we started working on people, processes and technology and optimize. seven or eight years ago, when we promised product to a customer, roughly 82% of the time, we delivered on time.

that was not acceptable. they're going to have this bill of terribles. 98% of the time, we deliver on tile. how? well, now, we have full visibility into customer demand. we know what the customers are buying. we produce roughly 300,000 products. so know whag the customers are buying, knowing where the demand is is, allows us to produce to dema demand. it allows us to stock in our distribution center, the products in the highest demand. it also gives the visibility to our sales force to sell products that are immediately available. we call them preferred products. no surprise that we discovered there are 30,000 products we sell 80% of the time. so having the visibility into what's being consumed using that to drive the production processes got us to the 97% number using this concept.

they come back with four things. they want faster time to market. from new idea to prokt, time to market. they want to optimize that. they want energy, roughly half is consume d by industrial operations. just in the u.s. alone is $6 billion in savings, so reducing cost is a major driver. the third area that most manufacturing companies will tell you that is a major today is uptime. they want to increase their asset up time. you walk into a food and bev type factory, most machines are only up 60 to 70% o time, so 30 to 40% of f the time, they're under maintenance, may be cleaning place. may be routine updates to the machines that are being made and that impacts productivity in a huge way.

the final area that's real important is enterprise risk reduction. building and more safety and security. it's making their environment track and trace. they want complete traceability. a lot of innovations coming out of rock well are helping our customers achieve these four major drivers. today, welcomed say that to some extent, manufacture iing is modular. and in its own way, it's cure. of course o, security is never done. we know this is a continuous process. where we're doing in the near future is towards making manufacturing more predictive

and optimized. a lot of machine learning, artificial analytics, cloud, mobility, all of these technologies will move manufacturing towards becoming more predictive and optimized. where we want to go towards, the long-term vision is to make manufacturing self-healing and optimized. bewe see a change today. in the past, manufacture you ares were looking for low cost labor, tax holidays as we heard this morning again from intel. looking for location where is they could put manufacturing where they could benefit from these cost inventives.

so as you build more connectivity, there's going to be a major security risk. they're looking for good risk for innovating good risk. they're looking for environment where there's a lot of innovation. i don't need to repeat what we heard this morning about talent. there's clearly the change in the talent that's needed in plan plants today. a lot of the jobs where shofl v shoveling with a lot more -- we need security experts. we need people who understand how the internet works, that also are living the plant environment, so clearly, there's a change in the skill set needed and we heard enough about education so i'm not going to belabor that point and finally, policies and procedures.

froms we need friendly regulations and policies. in the future, that's what manufacturing companies are going to look for. i would love for the council to continue its leadership of manufacturing. we need help to get manufacturing to its next evolution and it won't happen without public, private partnership, so thank you for giving me the opportunity to talk this afternoon. ladies and gentlemen, please welcome adam conn. >> before i begin, i'd like to thank the council. it's a very important time now

in text message and maintaining competitiveness, particularly within our field of advanced materials is crucial. i've been looking for ward to this talk for a number of of months. earlier this year, i spoke at the international forum of the americas in toronto talking about riding wave of o disruptive technologies. it was disconcerting to hear from the u.s.'s position in terms of competitiveness was being questioned and so one month ahead of the consumer electronics show, i am so delighted to be able to engage with you and talk about the work. opening up the possibility, a number of of captivating markets.

i would like to frame my talk with how it's more -- telecom and automotive market, now, the global semiconductor market is a huge market, $350 billion market worldwide. but specific to the united states, it's actually the third largest contributing to gdp behind automotive. more importantly, it enables over a trillion dollar global market. within these, three key sub markets are very limited. power devices. things are overheating, power efficiencies are are about 90% inefficient. augmented reality, virtual reality, very, very important, not only for fun, but military defense capability and sensing in addition to other industries, it's a $40 billion market with a compounded annual growth rate.

additionally, the sensor market is key and these are quite limited by the present materials capability. we specialize in diamond based semiconductors. diamond can conduct heat five times more efficiently than copper, the current status quo material, but above and beyond that, there's a highest power in addition to numerous other terrible attribute, which makes it very, very favorable for today's electronic, particularly as we're seeing in the new, different types of cell phones, won't mention names that are being either incinerating on power up or being ship damaged, so we know heat is still a major, major issue. and from diamond, we can see not only superior performance, increased energy efficiency, but thinner profile, the next big

thing. for me, i think the next big thipg is is really going to be fully transparent electronics. because diamond is a transparent semiconductor material. and so our earlier work in collaborating with national laboratories as well as other universities like the fabrication facility has been focusing on molecular engineering. and engineering them to alter the transparency or mechanical properties, so it's been a quite effective demonstration in terms of showing capability of diamond. we see that it's a million times

higher. extremely efficient material. this is perhaps 507 years out. it takes about ten years to bring a ship to market. if we look at the optical and thermal needs, the systems market. we can bring numerous solutions to much needed problems. within the aerospace market, today, we're developi optical windows, more reliable systems which can better detect ballistic signatures, as well as high dishtsy so they can survive et cetera.

with a semiconductor, we've been focusing on building a diamond prairie. this has been a public private partnership. it came from center melinda bush and actually having us relocate at headquarter in illinois. so not only traditional semiconductor labor, but also engineering the new wave of folks to work on materials in competitive labor and manufacturing. the site is the world's first compatible eight inch diamond semiconductor line. no other line is specifically

readily insert bable into today's marketplace to be able to address and process other materials and as a part of that signifying this, we actually are the recipients of an incentive package as well as the local county and city. we're proud to announce this sum e, we brought back key elements of mote rola's razor team. our chief operating officer chief technology officer as well as in addition to others down on the design level. after bringing on this talent, we had to do something exciting. right? so, we announced the third party test results of our diamond on glass technology, this brought the question of the world is can diamond actually provide what we

need in consumer electronics. more outlets picked up the story. so around how to 50 different outlets around the world reported on our third party testing results for diamond on glaz and the speculation was going wild. so i actually thought today for this audience, i would bring the world's first diamond glass screen and show you that not only is it here, it's been productized. and when we do something like this, we don't make this for one unit, we make it for 300 million units. so this technology is here today and actually, the next question after this, this is great, something for a diamond screen or wearable screen.

it has much higher -- when your phone is to your face, it's much more cool and so, from 800 times thinner profiles compared to the leading glass competitor, we see over six times harder material. if you checked the paper this is morning, we announced the world's first diamond glass lens. so, when we talk about the prospect of a diamond, is this material ready for market, we're not only seeing it being deployed in today's military

technology system, we're see ng the broad, broad spectrum and it's very exciting because this was not only originate nd the labs for the united states, especially developed here, resernled to scale, but now brought to pilot production, so i thought this was a very stellar way we could tate that innovative science started here. we'll be developed here and we have to bring it to mass scale. we are proud to be doing this in the midwest. thank you. >> our next panel will explore next generation opportunities at the intersection talent, technology, investment and infrastructure.

ladies and gentlemen, please welcome the cofounder new institute of thinking and research in motion, mr. mike -- dr. carol l. fult, chancellor at chapel hill and maly kai henderson, reporter, cnn. >> hi, everybody, thanks for being here. it's great to be here. we want to start the four pillars of course talent, infrastructure, investment and technology. want to start talking about talent. first. and i'm going to start with you on this one because this is something you've written about.

the idea of learn bability. the idea of upscaling. what do you mean by that? and what sort of responsibility do you think employers have in terms of that area? >> well, you know, part of this day has been you know, really encouraging from the aspect of talent because i think since we began our porng with dr. conn, dr. crow, fred smith, everyone has talked about access to scale talent as being an absolutely necessity for our nation to be competitive. labor markets are being affected by an ageing workforce, and developed countries alike. individuals making different choices based on changes in

environments and organizations thinking about organizational agility in a very different way, so, all of this translates into a bifur kag of the workforce. i think it was dr. crow who talked about this this morning. out of the u.s. workforce, there's 60, 70% that is fully imemployable that has the right skills and 30% of our workforce and population that is not participating, so, the biggest challenge that is facing us to be competitive is going to make sure that we as a nation have access to a broad pool of skilled workforce and we know today that 30% of the workforce has low or is unskilled or does not have enough skills to participate and be successful in a global competitive environment, so, that will be the defining challenge of our generation to figure this out.

because as brand talked about during lunch, if it's a very complex structurally driven global issue, there's not going to be a simple answer. because we've known about this and we've seen indicators of r our -- so this is not new, but we haven't made the turn. i would argue the current trends, the polarization based on the skills they have to contribute to the growth of organizations and to our economy, is going to accelerate and there's no indication that it's going to you know, mitigate or converge at this point. so, that's what's going to be so important for us to figure out. >> and carol, one of the things that's going on, talks about this bifurcation, in terms of the workforce. one of the things that seems to be going on is decline in

investment. federal investment. in terms of science. is that a trend you see reversing? has it stalled? where do you see things now? >> i get to start off with good news because just two days ago, congress did pass legislation that was going to increase nih. by about 4.8 million for some important targeted areas. 4 billion and another 4 billion on an annual bases and i think for all of us, that is good news and we're excited about it. i think that the needs are greater and the opportunities even graelter and i think that's where we start thinking about how can that investment be understood. can we do a better job making clear that if an investment comes back, people have been arguing that we can make sure that that investment isn't only going to help, it's critical. so, of it as being an investment in the workforce. we can probably talk about that

more, but universities are places where it in these areas of science, technology, that's where the young people get excited. they get the skill sets. we made a bet in america after world war 2, that if we brought innovators into universities where they were also teaching young people, we would create the entrepreneurial mind set necessary to stay great. when the money starts drying up, those people have a harder time doing what they do. they tend to retrench and not be as they become more risk adverse. they also tend to become less likely to increase the embrace of lots of different areas, so that talent force changes. the idea force changes. so another piece of good news is that it's related to bad news. last year, nih had 50,000 propoed sales. i'm a reviewer as are many people many this room. at least 25,000 of them had amazing work in them. if you run a business where

you're throwing out 25,000 great ideas every year, you have to start wondering about your business model, but if we start increasing that even a bit, we've got people ready so, if the money comes in, we're not in a position where we have a desert of ideas, so, it has that. it has the capacity to really fuel economies and i know all my colleagues out there could say they have these study, but a little fuel from the government, for example at chapel hill, we did a big study, for every dollar we get from the federal government, we generate 7 to $9 in additional money that goes to fuel research, back to the economy. we hire 100,000 people in the state. so, i mean, i could go on about that, but i think the good news is that should these investments increase, we're ready, the bad news is that if they don't, these pipelines that are holding on could hit a point where it's going to be a lot harder for

them to actually take advantage of what is sitting ready if for us as a nation to use. for come pettiveness. >> mike, i want to go to you on this. another pillar. infrastructure. done research in terms of manufacturing sector and a lot of emphasis on that. coming in, you have specifically done research on vulnerability. in terms of cyber attacks. something i hadn't thought of. can you talk about that? >> sure. my voice, i came down with a cold this morning. >> it's kind of sexy. >> very sexy. >> it's a very interesting dynamic because what we're seeing is we're seeing that right now, innovation is the pillar of growth. i really love what bronze said at lunchtime, around the fact that you must be innovative and carol said about the entrepreneurship, but what we're seeing is what happens clearly

is the ability that human error, cybersecurity, becomes an open issue with innovation. and the don't want to stifle innovation and, therefore, you have to keep going and as -- especially in a manufacturing sector, as things get more complex using echo systems, so not only developing your own product but working with other partners to develop a product and bring it to market you're only as good as your weakest link and you can't really secure yourself against human error, but it really does start number one to me is tone at the top and i think every organization from the board to the executive needs to have cyber security at the top of their list. everything they do they have to make sure that not only are they supporting innovation, but they're doing it in a -- i call it -- the word i use is a harmonized way, making sure that

they're sitting back and looking at their cyber security procedures and continuing to look at them because it's not something that you could put together once, put on a shelf and then -- and not remember it. they need to be updated. every time there's a breach they find something else out but you can't stifle innovation, like braun said, it's really important. things are getting more complex, more globalized using ecosystems. so it's really a balance of how do you push for innovation while at the same time watching for cyber risks. >> and, jim, i wonder if you could talk about america in relation to where other countries are in terms of investment in infrastructure. we talk about this global economy and this global race towards innovation. where is this country? >> thank you, neeva. i think i'm going to build on what fred smith said this morning and i think as you try

to drive your innovation globally you have to really assess the ecosystem globally that you're going to participate in and because that ecosystem determines the receptivity and the ability to commercialize your activities globally. over the last 30-plus years the primary underpinning of the system that we've used is calls trips, the trade related intellectual property system underpinning wto. what was happening through tpp is generally calls trips plus and europe with t tips said i'm not in for trips plus. i want trips. and china says i'm more interested in trips minus. i mean, that's -- i'm not trying to be pejorative but you could make a fair case for that and i'm simplifying a little bit. then you have a new administration that's saying i don't like trips plus.

is that because it's not good enough? i want trips plus plus, or because trips wasn't right and i want to look at something else. so this is an uncertain environment to commercialize in. they are rifle rouse, it's mer can tilist, i find it highly unlikely they're going to come together in the near term. so this is a different situation for commercializing globally in the next decade than we've known in the past 30 years. i study these things a fair bit. one study -- or engage on it i should say. one study which is interesting for your chair is in ag tech patents last year 92% of all ag tech patents from university research were from china. so they published over a million

patents. so this is a land grab and good game theory is stay out of the game until you get enough land and then come back in, which is rifle rouse and mercantilist. so i don't -- i think i personally believe -- sorry. i personally believe this is the most pressing issue to globalizing right now because the rule systems are diverging and becoming quite political, evidence what's happening in the election and the relationships to the east and to the west and all of their turbulence and nativism. so i think this is going to be central to figuring out how we commercialize ideas in the next decade. >> and, carol, i wonder if you could talk about -- one of the things that the obama administration has tried to do is put a focus on stem education, primarily focusing on women, bringing more women into the field, encouraging girls to

go into stem fields. has that mattered at all? have you seen a difference in terms of conversations around -- around that or in terms of interest? >> well, i think everyone that is in higher ed spends a lot of time trying to think about these disparate gaps, about the changing demography of america and the fact that we look around this room or we look around the rooms in higher education at the top, most of us look the same and there aren't that many that look like me and there's even fewer that look like a lot of our students. so we think a lot about bringing them in. i do think even going back to title 9 that's had a big influence in bringing diversity into our infrastructure and our research. a lot of the best examples of the value of diverse research teams actually come from entrepreneurial areas where they talk about you put six people in a room that all come from the same background you get the same idea, six people with six

different ideas, six different backgrounds and you're going to get something that is dynamic. i think -- this goes back to me about investment. one of the great ways investment in research -- and i'm talking mostly university research but it's all research -- one of the things it does is it does give us a chance to also address other societal problems. we use that research to develop a diverse team of young people who start fueling as they move up with ideas like the way the obamas did it or universities where you get more and more people, you're going to see the diversity of the ideas increase and we have a chance very much to start also reducing those income disparities that go with people thinking that they're limited to disciplines in certain -- you know, that women can't do science or students of color can't become engineers. as we erase those boundaries we start doing immense good not only for the science, the stem that we're doing, but also for the goal that we have to

diversify the workforce and make the talent pool so much more energetic. to i think they go together. >> do you want to jump in? >> i believe not only are we making it much more energetic and i think the business -- you know, the clear business case is that diversity of thought drives better business outcomes. the participation of women depending on where you are in the world, is either lower or significantly lower than that of men, but in almost all of those cases the level of education for the very same women is higher than it is for men. so if you think about a demographic that is shrinking in all of the developed world, all countries in europe have a shrinking population with one exception which is france, we are holding our own, but within our own country roughly the same demographic tendencies are occurring depending on ethnicity. so our need to bring in skilled talent into the workforce is

huge and women is actually the biggest untapped pool of skilled talent that is not fully utilized today to varying degrees in developed countries and that's certainly the case also here in the united states. >> and there also seems to be, jim, sort of a turn away from globalism and thinking that america is part of this larger economy in terms of immigration, in terms of bringing talent in. i mean, is that going to affect kind of diversity if there's this shrinking away, jim, from thinking that america -- yeah, is part of this global economy? >> oh, i think there's without a doubt a talent war, no question, but i think america does exceptionally well because of the quality of their education institutions and the base of their companies. so you have a bit of an embarrassment of riches but of course it can never be good enough. but, you know, how you manifest that, there was a comment from the gallop gentleman who said

though there's more innovation business formation and diaynami is going down. so i do think how you manifest all this into prosperity and productivity i believe the debating element is much more infrastructure personally because as dr. foltz said there's a lot of talent out there and not the infrastructure to receive it. in her case. so, you know, i mean, that's more on a research thing than a business formation but i think it's a pretty good metric. so i think the infrastructure is -- is a very, very important piece to look at. and i think, again, i'm trying to build off of things like mike talked about the cyber, people are excited about block chain and it's really great because it allows all this stuff but it also allows people to do things without being tracked. so a lot of these things raise complex issues all along the way.

>> mike. >> one thing when -- the question about stem, what we've realized in the business environment is we've been a huge proponent on stem. the majority of our businesses at deloitte need science, technology, mathematicians, but we're down into high schools now. we have to start earlier and earlier. we're talking about programs for freshmen in high school because we believe that now, you know, when you start internships in sophomore years of college it's not good enough. >> right. >> we have to start much, much younger. so we've been investing -- that was probably a big ah-ha that we've had. when you speak to the younger generation, people in their 20s that have joined us in the past five, six years they look at things totally differently than someone my generation looks at it. they believe you have to start early, you have to start getting those diverse skills embedded much earlier. we're putting in programs now looking at freshmen in high school now, totally different than when i