Becoming a policy entrepreneur (with Tom Kalil)

Feb 15, 2023 Episode Page ↗
Overview

Spencer Greenberg speaks with Tom Khalil about policy entrepreneurship, market shaping, and cultivating agency. Tom shares insights from his 16 years in the White House, detailing how to influence government, build coalitions, and design interventions to solve large-scale problems. He also discusses philanthropic strategies for supporting exceptional talent and high-risk scientific endeavors.

At a Glance
12 Insights
1h 5m Duration
18 Topics
7 Concepts

Deep Dive Analysis

Introduction to Policy Entrepreneurship and White House Work

Examples of Presidential Initiatives and Their Impact

Defining Policy Entrepreneurship and Working from Outside

Five Tools for Policy Entrepreneurs in the Executive Branch

Articulating Concrete Goals for Government Action

Strategies for Selecting High-Impact Policy Initiatives

Understanding and Applying Market Shaping Principles

Addressing Challenges in Government Market Shaping Initiatives

Leveraging Private Sector Demand for Market Shaping

Designing Target Product Profiles for Innovation

Creating a Marketplace for Outcomes with Investor Involvement

The Innovation Toolkit Metaphor for Problem Solving

Schmidt Futures: Philanthropy's Focus on Talent and Science

The Concept and Value of Focused Research Organizations (FROs)

The Intersection of AI and Scientific Discovery

Proudest Achievement and Recurring Themes

Addressing Lack of Research Capacity in Government Agencies

The 'Tour of Duty' Model for Public Service

Policy Entrepreneurship

Policy entrepreneurship involves identifying areas of public policy that could be improved (e.g., stopping something the government does, or starting something it isn't) and possessing the skills to translate those ideas into concrete government action. It's akin to how commercial entrepreneurs address unmet market needs with products or services.

Market Shaping

Market shaping refers to interventions designed to influence the demand side of innovation, often by articulating desired outcomes and making financial commitments contingent on success, rather than solely increasing the supply of innovation through research and development grants. This approach aims to create a market for solutions that might not otherwise emerge.

Advanced Market Commitment (AMC)

An Advanced Market Commitment is a market-shaping mechanism where a sponsor (e.g., government, foundation) issues a purchase order for a product that doesn't exist yet. By committing to buy a certain quantity at a set price if the product is successfully developed, it influences demand for innovation and de-risks private sector investment.

Target Product Profiles (TPP)

A Target Product Profile is a methodology, often used in the global health community, to explicitly define the desired performance characteristics and affordability (both capital and operating expenses) of an innovation or medical device needed to solve a specific problem. It focuses on what the solution needs to do, rather than dictating how it should be built.

Focused Research Organizations (FROs)

Focused Research Organizations are a funding mechanism designed to support ambitious, team-based scientific projects that are difficult to fund through traditional venture capital (due to lack of clear profitability) or university settings (due to individual career incentives). These organizations often aim to produce public goods, such as large datasets, for the scientific community.

General Purpose Technologies

General Purpose Technologies are an economic concept referring to technologies (like electricity, interchangeable parts, or the internet) that don't just create one product but transform entire economies. They drive higher levels of productivity, economic growth, and job creation across multiple sectors.

Tour of Duty

A 'tour of duty' is a model for public service where individuals, often from the private sector with specialized skills (e.g., software engineering), commit to working in government for a defined, shorter period (e.g., 3-4 years) to solve specific problems. This approach brings fresh perspectives and cutting-edge expertise to government operations before individuals return to their previous careers.

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What is a 'policy entrepreneur' and how do they differ from commercial entrepreneurs?

A policy entrepreneur identifies public policy areas that need improvement and possesses the skills to implement those ideas within the government, similar to how commercial entrepreneurs address unmet market needs with products or services.

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Can people become policy entrepreneurs if they're not already political office holders or insiders?

Yes, it's possible to be an outsider, but it requires teaming up with one or more partners working within the system to inform and shape policy.

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Aside from speaking directly to the POTUS, what are some ways policy entrepreneurs can make progress on their goals within the government?

Policy entrepreneurs can leverage legislation, the president's budget, executive actions, the president's 'bully pulpit' to convene and mobilize stakeholders, and recruit new types of people with specific skills into government roles.

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Why is it so hard for some people to articulate actionable plans that would accomplish their goals within the government?

Many people view the government as a 'black box' and struggle to connect their ideas to specific actions that particular departments, agencies, or external stakeholders could take.

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What is 'market shaping' and why is it considered underrated?

Market shaping involves influencing the demand for innovation by articulating desired outcomes and making financial commitments contingent on success, rather than just funding R&D. It's underrated because the government has well-established mechanisms for commitments contingent on failure (loan guarantees) but not enough for success, due to newness, budget laws, and a shortage of design expertise.

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Why do some government departments have no budget for R&D, and what are the consequences?

Some departments, like the Department of Labor, have literally zero research budget, which prevents them from asking 'what if X were much better than it currently is today?' and leveraging science and technology to develop more effective solutions for important problems.

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How can philanthropists support high-risk, high-return scientific research that traditional funding mechanisms might miss?

Philanthropists can bet early on ideas, support Focused Research Organizations (FROs) for projects not suited for startups or universities, and fund the creation of large, transformational public datasets that researchers might not propose due to perceived funding barriers.

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What are the key preconditions for major scientific breakthroughs involving AI, like AlphaFold 2?

Such breakthroughs typically require a very well-defined problem, a large public dataset relevant to the problem, and a clear benchmark for evaluating the performance of different algorithms.

1. Cultivate a Sense of Agency

Recognize that many things in the world are potentially changeable through human action or inaction. Adopt a mindset that encourages you to view seemingly fixed problems as solvable, and try to make this sense of possibility contagious to others.

2. Become a Policy Entrepreneur

Identify public policy areas needing improvement (what government should stop/start doing) and learn the skills to translate ideas into action within the political system. This involves understanding government tools and building coalitions to achieve large-scale impact.

3. Use ‘President’s Call’ Thought Experiment

When seeking to influence policy, ask yourself: ‘If the President called anyone on the planet, who should they call and what exactly should they ask them to do?’ This forces concrete thinking about specific actors and actionable steps, moving beyond abstract notions of ’the government.’

4. Build Effective Coalitions

To achieve complex goals, clearly articulate who the coalition members are and the mutually reinforcing steps you want them to take. Explain why the action is in their enlightened self-interest, make it easy for them to agree, and identify the ideal messenger.

5. Leverage Government’s Five Tools

Understand and utilize the executive branch’s key tools: working with Congress on legislation, influencing the president’s budget, employing executive action, using the president’s ‘bully pulpit’ to convene and build movements, and recruiting skilled individuals to government roles.

6. Design Market-Shaping Interventions

For problems markets don’t solve well, influence the demand for innovation by articulating desired outcomes and making financial commitments contingent on success. Examples include advanced market commitments (purchase orders for non-existent products), milestone payments, and incentive prizes.

7. Prioritize Policy Initiatives Strategically

When choosing policy issues, consider the potential upside if successful and the probability of success. Prioritize areas with minimal existing opposition (‘hit ’em where they ain’t’), avoid overly expensive initiatives, and assess the government’s capacity to implement.

8. Define Success with Target Profiles

For specific problems (e.g., medical devices for global health), clearly define the desired innovation’s performance characteristics and affordability requirements, without dictating how to build it. This explicit definition of success helps guide innovators and evaluate progress.

9. Support Focused Research Organizations

Philanthropists should consider funding ‘Focused Research Organizations’ (FROs) for scientific problems that don’t fit traditional startup or university models. These projects are often public goods, require team science, and can pursue ambitious, field-transforming goals without immediate publication pressure or VC-attractive profitability.

10. Address Research System Bottlenecks

Recognize that traditional peer review can stifle high-risk, high-return ideas. Encourage researchers to identify ’transformational datasets’ even if seemingly unfundable, and support these through philanthropic means or by funding tools that lower data collection costs.

11. Consider Government ‘Tour of Duty’

If you care about improving government, consider serving for 3-4 years in roles like DARPA program managers or the U.S. Digital Service. This allows you to apply cutting-edge skills to important problems, bringing fresh perspectives and operational expertise to public service.

12. Advocate for Agency Research Capacity

Promote the establishment of research and innovation capacity within federal agencies that currently lack it (e.g., Department of Labor). This enables agencies to proactively identify and pursue ambitious goals, leveraging science and technology to develop more effective solutions for critical problems.

The quote unquote government is not always a useful level of abstraction. It's really particular departments and agencies either operating individually or collectively or some sort of external stakeholders in the private sector that the president is seeking to mobilize.

Tom Kalil

The federal government has a well-established and widely utilized mechanism for making financial commitments that are contingent on failure. Those are loan guarantees. But we're barely scratching the surface on our ability to make financial commitments that are contingent on success.

Tom Kalil

If you woke up and you were the chief scientist or an agency that currently had no research capacity, and all of a sudden it did and you were the chief scientist, what goals would you set and what are examples of projects that you would support in order to achieve those goals?

Tom Kalil

No one is coming. It's up to us.

Tom Kalil

Thought Experiment for Concrete Policy Action

Tom Kalil
  1. Imagine a meeting with the President in the Oval Office where they offer to call anyone on the planet to help solve your problem.
  2. If the person is inside government (e.g., head of NIH), the President can direct them.
  3. If the person is outside government (e.g., head of a foundation), the President can challenge them.
  4. Your task: Identify who the President should call and what specific action they should be asked to do.

Designing Market Shaping Interventions (Global Health Model)

Tom Kalil
  1. Identify a specific problem (e.g., newborn mortality in sub-Saharan Africa).
  2. Break down the problem to identify specific needs (e.g., a low-cost, rugged medical device for jaundice).
  3. Define what the innovation needs to do, not how to build it, by providing information on performance characteristics.
  4. Specify what the innovation needs to be priced at (CapEx and OpEx) to be affordable in the target context.
  5. Be explicit about what constitutes success and how an innovation would be evaluated.

Preconditions for AI-driven Scientific Breakthroughs (AlphaFold 2 Model)

Tom Kalil
  1. Identify a very well-defined problem (e.g., predicting protein structure from amino acid sequence).
  2. Ensure the existence of a very large public dataset relevant to the problem (e.g., the Protein Data Bank).
  3. Establish a clear benchmark for evaluating the performance of different algorithms in solving the problem.
$38 billion
Total federal investment in nanoscale science and engineering since initiative launch Resulted from President Clinton's initiative to double federal funding.
$50 million
Maximum prize authority for federal agencies Granted by Congress, allowing any agency to use incentive prizes.
Over 1,000
Number of instances agencies have used incentive prizes on challenge.gov Demonstrates widespread adoption of incentive prizes.
Over $50 million
Cost per astronaut per seat paid to the Russian government after the space shuttle retirement Before NASA-SpaceX collaboration provided an alternative.
78%
Percentage of top researchers who would change their research program 'a lot' if they had total discretion over funding Based on a survey by the FAST grants team of biomedical researchers.
Zero dollars
Research budget of the Department of Labor Indicates a lack of capacity for innovation and problem-solving within the department.
Slightly less than $4 billion
Research budget of DARPA Contrasts with agencies like the Department of Labor.
$925 million
Commitment by Stripe, Meta, Alphabet, McKinsey, and Shopify to purchase permanent carbon removal Through Frontier Climate, significantly impacting carbon removal startups' ability to raise capital.