ABSTRACT
Government has exerted a positive influence on technology research and development via its research efforts, and defense-related research has been prominent in this activity. The US Federal Government accounts for a sufficiently large proportion of the total economy that it cannot avoid affecting the course of economic development with any action or inaction that it takes. The three policy channels that are available for dealing with serious recessionary conditions are fiscal policy, monetary policy, and regulation. The onset of the financial crisis shifted the emphasis of Federal Reserve action from originator of monetary policy to its role as bank regulator. The burden of lack of a cost breakthrough diminishes the chance that an industrial policy will achieve its stated growth goals through support of stage-one industries. In as much as private sector investment is the preeminent force driving the upswing of the technology cycle, one might expect it to be an important element in initiating such a recovery.
