The economist has a special report on innovation this week. There are 8 articles similar to this one and as of now none are subscription only:

see upper right: http://www.economist.com/printedition/

What do you think might happen if the federal government tried to implement a centralized innovation initiative?: Would it be a joke? a moderate success? a non-entitiy? or could it even be counter-productive?

If modern art is any indication, it would be mostly a joke/counter-productive, with a few successes.

well to me it's called patent reform...