(see Table 4-1). Meanwhile, demand for student aid continues to increase while federal funding for basic and applied research at public and private universities has, in real terms, declined in the face of competing priorities for funding. (See figures under Recommendation 1 in Chapter 5.)

With these developments in mind, the committee has identified a set of specific challenges and opportunities that a reasoned set of policies must address in order to produce the greatest return to our society, our security, and our economy. The first group identifies issues in the partnership among the federal government, states, business, and universities:

•  Federal funding for university research has been unstable and, in real terms, declining at a time when other countries have increased funding for research and development (R&D), both in nominal terms and as a percentage of gross domestic product.

•  State funding for higher education, already eroding in real terms for more than two decades, has been cut further in the recent recession.

•  Business and industry have largely dismantled the large corporate research laboratories that drove American industrial leadership in the twentieth century (e.g., Bell Labs), but have not yet fully partnered with our research universities to fill the gap at a time when we need to more effectively translate, disseminate, and transfer into society the new knowledge and ideas that emerge from university research.

•  Research universities need to be responsive to stakeholders by improving management, productivity, and cost efficiency in both administration and academics.

The second group identifies issues that affect the operations of universities, the efficient administration of university research, the effectiveness of doctoral education, and the robustness of the pipeline of new talent:

•  Insufficient opportunities for young faculty to launch academic careers and research programs;

•  Underinvestment in campus infrastructure, particularly in cyberinfrastructure, that can lead to long-term increases in productivity, cost-effectiveness, and innovation in research, education, and administration;

•  Research sponsors that do not pay the full cost of research they procure, meaning that universities have to cross-subsidize research from other sources;

•  A burdensome accumulation of federal and state regulatory and reporting requirements that increases costs and sometimes challenges academic freedom and integrity;

•  Opportunities to improve doctoral and postdoctoral preparation



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