Innovation Isn't Enough.(state of universities in the United States )(Cover story)

Byline: Michael M. Crow (Crow is president of Arizona State University.)

The modern university is the ideal environment for the creation and transfer of knowledge that drives national competitiveness in an increasingly global era. Its most effective form is the American adaptation of the European model, in which teaching, learning and research are integrated into a single institution. Indeed, the American university has proved capable of almost anything, from developing advanced economic theories to creating new life forms. And that's in addition to providing basic liberal-arts training to millions of people who drive commerce, education, government and the arts around the world.

From the European Union to China, India to Mexico, many national leaders understand that the university is the critical catalyst for America's adaptability, economic robustness and emergence as a great power. And they are moving aggressively to catch up. In France, President Nicolas Sarkozy is outlining a total overhaul of the country's underperforming university system. In India, a private citizen is building a university for 100,000 students, while China is building or revamping hundreds of institutions. And the universities created by emerging economies beginning in the 1990s and through 2020 will likely play a decisive role in reshaping the global balance of economic power.

That is bad news for the United States. The past two decades of American university development have been characterized largely by self-satisfaction arising from steady progress by the top 20 or so research universities. And America as a nation has been coasting. Since 2000, the United States has lost its edge in the graduation of engineers and technologists. The country no longer dominates scientific discovery, innovation or exploration. Most important, the United States has not launched any effort to build new institutions to accommodate its increasingly diverse population of more than 300 million.