(FORTUNE Magazine) – Robert N. Noyce was a founder of two of Silicon Valley's most creative companies, Fairchild Semiconductor and Intel. Along the way he helped invent the integrated circuit. He has now taken on the presidency of Sematech, a new consortium that hopes to help U.S. chipmakers overtake the Japanese lead in semiconductor manufacturing. Recently he talked about America's ability to compete.

Is it too late? Should Sematech have begun ten years ago? We are not nearly as far behind as some think. We are in better shape than the Japanese when they started forming consortiums back in the Seventies. And we too have a tradition of working together. In the 1860s we decided to fund collective research for what was then our largest industry, agriculture. We set up land-grant colleges and agriculture extension services.

What have you learned from Sematech about running a consortium? The first question a consortium has to ask itself is what can it do better than the individual members. I don't think we were asking that question at first. Sematech can't do anything about the fact that the Japanese have twice as much capital per worker invested in export industries. But we can do once and better what is being done ten times by ten individual companies: We can thoroughly check out machinery and provide a forum for members to exchange solutions to problems.

You suggest that the U.S. needs more capital investment. How do we raise the savings rate? By doing all the things that are unpopular. In Japan home mortgage payments are not tax deductible. We need a lot of value-added taxes on consumption. And we should reduce the capital gains tax by one-tenth for each year an asset is held.

Should the U.S. government protect a domestic HDTV industry from foreign competition? You have to attract investment to the industry, and so you have to assure people that there is an opportunity to make a profit in the business. For now it is hard for Wall Street to see what comparative advantage we have. The perception is that the industry would be as vulnerable to dumping by the Japanese as conventional TV manufacturing was in the Seventies. Somebody in government, preferably President Bush, has to make clear our determination to be in the HDTV business. We could give it infant-industry protection, insisting that for ten years all sets be built in the U.S. Or we could do a reverse FSX: The Japanese could build 40% of the sets but would have to give us the technology.

What else do we need to compete? Mothers who say proudly, ''My son, the manufacturing engineer.'' We have glamorized the design engineer too much. How do we get that respect for manufacturing engineers? The attitude should change because the job is changing. Running a factory is no longer wearing a blue collar and supervising repetitious work. The manufacturing engineer has become the manager of sophisticated robotic equipment. Manufacturing is more than just driving in a screw again and again. Now you program a robot to do one job and move on to the next robot.