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For decades, the US assumed ideas would naturally flow from research into commercialization. That assumption no longer holds. As Anne Marie Knott shows, the US innovation system is no longer fit for purpose in an age of great-power rivalry. Since 1980, American R&D productivity has fallen dramatically, while China has become far better at turning R&D into growth. Why? Because the two countries operate from fundamentally different models of innovation. The United States follows a 'river' logic: produce frontier science and trust the market to carry discoveries downstream. China follows a 'lake' logic: absorb, develop, diffuse, and capture value. Drawing on new empirical research and a widely applicable measure of R&D productivity, Knott challenges seven myths shaping US innovation policy and offers a reform agenda built less on new spending than on using existing tools far more effectively. The result is a provocative account of innovation, growth, and national power.