(FORTUNE Magazine) – COMPETITIVENESS 12 THE NEW AMERICAN CENTURY: WHERE WE STAND Will the U.S. star in the next century or will Japan and Europe command the stage? FORTUNE gives American competitiveness an encouraging, if cautionary, review. by Thomas A. Stewart

MANAGING 24 SMART MOVES BY QUALITY CHAMPS U.S. industry spent the 1980s mastering the making of worldclass products. New strategies will help it triumph in the 1990s. by Erik Calonius

PEOPLE 34 25 WHO HELP THE U.S. WIN Innovators everywhere are generating ideas to make America a stronger competitor. From a boss who demands the impossible to a mathematician with a mop, these individuals recognized by FORTUNE are dedicated to putting their ideas into action: Sherm Mullin, Ralph Gomory, W. Edwards Deming, Sandra Hale, Dan Burton, Paul Allaire, Eugene Gwaltney, Rollie Boreham, Steven Schlossstein, Edward Scolnick, Robert Reich, Norman Darden, T. J. Rodgers, Ronald Nagrodski, Dan Sharp, Carla Hills, Tom Blunt, Andy Grove, James Morgan, Polly Williams, Allan Bromley, John W. Wallace, Paul Fireman, Dan Kaplan, and Larry Smarr. by Louis Kraar

POLITICS & POLICY 46 THE THAW IN WASHINGTON The White House is mapping out a partnership with business that stops short of heavy-handed industrial policy. by Edmund Faltermayer

50 NEW ASSISTANCE FROM THE STATES

POLITICS & POLICY 52 HIGH-LEVEL SUPPORT After years of indifference, the government -- even the President -- is promoting U.S. business abroad. by Lee Smith

AMERICA'S 50 BIGGEST EXPORTERS 58 EXPORTS: SHIP 'EM OUT Overseas sales are reversing the trade deficit and providing most of the growth in the American economy. by James Beeler

TECHNOLOGY 60 MORE SPINOFFS FROM DEFENSE Despite the billions invested, military technology hasn't delivered much to the marketplace lately. Here's how to squeeze more competitive clout from the Pentagon. by Nancy J. Perry

63 SOME PLOWSHARES FROM THE PAST

65 DARPA: A BIG POT OF UNRESTRICTED MONEY

THE SOCIETY 66 JAPANESE PICK UP U.S. IDEAS And Americans learn about Japan at YKK's zipper-making plant in Georgia. by Louis Kraar

TRAINING 68 THE WORKERS OF THE FUTURE To compete, companies need skilled employees who can turn on a dime. This means spotting good people early, training them continuously, and making them want to stay. by Nancy J. Perry

MANUFACTURING 78 WHAT AMERICA MAKES BEST It sure is true what they say about better mousetraps. Companies that produce superior goods will find the world at their doorstep -- and rivals in their dust. by Louis S. Richman

82 A PRIDE OF PRODUCTS Consumer goods, computers, a motor for drilling crude oil, and more -- all reflect the dazzling variety of goods made in America and made best in the world. A picture portfolio. by Louis S. Richman

DEPARTMENTS 4 EDITOR'S DESK 88 SOURCES OF HELP

COVER: Flag created by Robert Gerlt and Sudhakar Menon of the Environmental Systems Research Institute with ARC/INFO geographic information system software, commonly used in three-dimensional mapmaking.