In Vietnam.
Any American who has looked at the educational systems in other countries is quite likely to be shocked by their evident superiority in preparing their students to work in the real world. I've had this experience personally when looking at the educational systems in the former Soviet Union (in particular, in Estonia and St. Petersburg).
Education isn't the only prerequisite to innovation, and America still has a leg up on some of the other requirements (in particular, access to capital). But all of the factors that once gave America an unbeatable edge are rapidly eroding here – and rapidly growing elsewhere. I can't help but come to the conclusion that in the not-too-distant future (say, 10 or 20 years), many other parts of the world will out-innovate the United States. It's hard to imagine how we could turn that around, especially with the ascendancy of “Progressive” politics in the past 20 years or so.
It's very sad for us, but very hopeful for the Vietnams of the world...
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