The convergence of United States federal science and economic policy that began in earnest under the Reagan administration formed the First Stage in an emerging post-Cold War drive toward technological innovation. A frenzy of new state-based initiatives now forms the Second Stage, further promoting universities as decisive tools for economic competitiveness. This paper outlines the characteristics of this Second Stage. Among the author’s conclusions are the following: high tech (HT) economic activity is already relatively widespread among the various states; leading HT states rely heavily on their university sectors and a highly educated workforce, yet are increasingly importing talent and neglecting investment in the education and skills of their native population; the long-term commitment of states to financially support the frenzy of HT initiatives is unclear; and state initiatives are rationalised by lawmakers as filling a need not currently met by the private sector or universities and, in part, by a sense of competition between states, with only a minor concern with global competition, thus far. As this paper explores, the politics of HT, including the focus on university-industry collaboration and neo-conservative religious/moral controversies over stem cell research, are a significant factor for understanding how and why most states are pursuing the Second Stage.