The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates.
On March 31, The White House published the American Jobs Plan, laying out the Biden administration’s strategy to invest in a way that would rival the investments that resulted in the United States’ winning dominance over its rivals in space, and the creation of the interstate highway system.
Before this, MorningConsult published my op-ed, Biden Administration Needs an Agency to Lead Technological Innovation in Global Supply Chains, on Feb. 25. In that context, here are the three things I would want to see happen as the American Jobs Plan is implemented.
Serve as the catalyst for a Cambrian Explosion of supply chain innovation and technology
I am an optimist. I believe that though it will be difficult, humanity will figure out a way to solve the climate crisis. But solving that crisis requires that we make enormous headway in supply chain technology AND in climate technology. In #SupplyChainTech: What is Supply Chain Technology, and Why is it the Biggest Investment Opportunity of Our Lifetime?, which I published on my personal blog on March 18, I repeated the argument I have made often in the past, in this column and elsewhere: that we cannot solve the climate crisis until we refashion man-made supply chains so that they no longer cause harm to our natural environment.
The plan specifically calls out climate technology. I am hopeful that supply chain will come more into President Joe Biden’s focus once the Executive Order on America’s Supply Chains, which the administration issued on Feb. 24 and which called for a 100-Day Supply Chain Review, is complete. The distinction is important, as I point out in my March 18 blog post, because all #SupplyChainTech is #ClimateTech, but not all #ClimateTech is #SupplyChainTech.
Revitalize America’s SMB sector, especially in advanced manufacturing and advanced materials
My Jan. 22 article in this column, Commentary: Time to turn rest of US into innovation factory argues that it is time for investments to be made that return America’s heartland to global leadership in areas of industry in which it was historically strong and globally dominant, but now with the added benefit of the United States’ global superiority in information technology as an added boost.
Here too, I am encouraged to see that President Biden is calling for up to $300 billion of investments by the federal government to begin rebuilding America’s manufacturing sector because a healthy, robust and resilient manufacturing sector is an important aspect of the United States’ economy.
Strengthen America’s social structures and safety nets to serve as a floor for the economy
On March 23, 2020, FreightWaves published An open letter to the Supply Chain Caucus of the U.S. House of Representatives. In that letter, Craig Fuller, Lisa Morales-Hellebo and I observed that “Supply chains are formed from a complex and interconnected network of social, environmental and economic systems. If any one of these subsystems suffers a catastrophic failure, the entire system fails. Moreover, it is generally impossible to predict when a catastrophic failure might occur, or in which subsystem such a failure is most likely to occur.”
I am encouraged that President Biden is calling for investments in workforce development, job creation, health care and education. The Marshall Plan for Moms, Basic Income and other programs to strengthen social safety nets for United States citizens are a critical aspect of developing strong, resilient and robust supply chains that can always bounce back stronger and better after an exogenous shock such as COVID-19. It would be great to see such initiatives become part of the final policy proposal that is implemented.
It goes without saying that transportation and logistics, and energy, serve as complements to the areas that I have highlighted, and the plan calls for investments in these two areas as well.
What I did not see but hope makes it into the final policy that becomes law
The need for capital to fund early stage technological innovations in supply chain technology and climate change technology is so dire that I would like to see specific incentives aimed at encouraging investors to direct more private capital to those two areas. A simple step would be to waive all federal and state taxes on the first $500 million of capital gains for investments in early stage supply chain and climate technology startups.
Why $500 million? That’s a number big enough to encourage investors of all types and sizes to think more seriously about allocating capital toward these areas.
Given that I am raising an early-stage fund on AngelList, I am also eager to see the Securities and Exchange Commission change its regulations to allow funds like ours to have more than 99 accredited investors as limited partners in each fund because that will allow us to accept more investors by setting a lower minimum investment amount.
From what we are learning while building REFASHIOND Ventures and The Worldwide Supply Chain Federation, this would be a great complement to the administration’s push to create a national network of small business incubators and innovation hubs as part of this plan.
No policy proposal is perfect. Not even in the eyes of the people who craft it and push for its adoption. However, this is a good start — one that should set a strong foundation for the future. We should lend it our support AND constructive critiques about areas in which it might have unforeseen weaknesses.
If you are a team working on innovations that you believe have the potential to significantly refashion global supply chains, we’d love to tell your story in FreightWaves. I am easy to reach on LinkedIn and Twitter. Alternatively, you can reach out to FreightWaves at firstname.lastname@example.org.
Author’s disclosure: I am not an investor in any early-stage startups mentioned in this article, either personally or through REFASHIOND Ventures. I have no other financial relationship with any entities mentioned in this article.