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111 i' ~
Federal Funds
for Science
and Terhnolo~
Committee on Criteria for Federal Support of
Research and Development
NATIONAL ACADEMY OF SCIENCES
NATIONAL ACADEMY OF ENGINEERING
INSTITUTE OF MEDICINE
NATIONAL RESEARCH COUNCIL
NATIONAl ACADEMY PRESS
Washington, D.C. 1995
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NOTICE: The project that is the subject of this report was approved by the Governing Board of the
National Research Council, whose members are drawn from the councils of the National Academy of
Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the
committee responsible for the report were chosen for their special competences and with regard for
appropriate balance.
This report has been reviewed by a group other than the authors according to procedures
approved by a Report Review Committee consisting of members of the National Academy of Sciences, the
National Academy of Engineering, and the Institute of Medicine.
The National Academy of Sciences is a private, nonprofit, self-perpetuating society of distin-
guished scholars engaged in scientific and engineering research, dedicated to the furtherance of science
and technology and to their use for the general welfare. Upon the authority of the charter granted to it by
the Congress in 1863, the Academy has a mandate that requires it to advise the federal government on
scientific and technical matters. Dr. Bruce Alberts is president of the National Academy of Sciences.
The National Academy of Engineering was established in 1964, under the charter of the National
Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its adminis-
tration and in the selection of its members, sharing with the National Academy of Sciences the responsibil-
ity for advising the federal government. The National Academy of Engineering also sponsors engineering
programs aimed at meeting national needs, encourages education and research, and recognizes the
superior achievements of engineers. Dr. Harold Liebowitz is president of the National Academy of
~ . .
ngmeerlng.
The Institute of Medicine was established in 1970 by the NationalAcademy of Sciences to
secure the services of eminent members of appropriate professions in the examination of policy matters
pertaining to the health of the public. The Institute acts under the responsibility given to the National
Academy of Sciences by its congressional charter to be an adviser to the federal government and, upon its
own initiative, to identify issues of medical care, research, and education. Dr. Kenneth I. Shine is presi-
dent of the Institute of Medicine.
The National Research Council was established by the NationalAcademy of Sciences in 1916 to
associate the broad community of science and technology with the Academy's purposes of furthering
knowledge and advising the federal government. Functioning in accordance with general policies
determined by the Academy, the Council has become the principal operating agency of both the National
Academy of Sciences and the NationalAcademy of Engineering in providing services to the government,
the public, and the scientific and engineering communities. The Council is administered jointly by both
Academies and the Institute of Medicine. Dr. Bruce Alberts and Dr. Harold Liebowitz are chairman and
vice chairman, respectively, of the National Research Council.
Support for this project was provided by the Department of Defense (under Contract No.
N00014-95-C-0314), the National Institutes of Health (under Contract No. N01-OD-4-2139,Task Order #4),
the National Science Foundation (under Grant No. OPS-9528889), and the Basic Science Fund of the
National Academy of Sciences. Any opinions, findings, and conclusions or recommendations expressed in
this material are those of the authors and do not necessarily reflect the views of the National Science
Foundation.
Library of Congress Catalog Card Number 95-71602
International Standard Book Number 0-309-05347-1
Additional copies of this report are available from:
National Academy Press
2101 Constitution Avenue,NW
Box 285
Washington, DC 20055
800-624-6242
202-334-3313 (in the Washington Metropolitan Area)
B-680
Copyright 1995 by the NationalAcademy of Sciences. All rights reserved.
Printed in the United States of America
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Committee on Criteria for Federal Support
of Research and Development
FRANK PRESS, Carnegie Institution of Washington, Chair
LEW ALLEN, JR., Charles Stark Draper Laboratory, Inc.
DAVID H. AUSTON, Rice University
FOREST BASKETT, Silicon Graphics Computer Systems
BARRY R. BLOOM,Albert Einstein College of Medicine
DANIEL I. EVANS, Daniel I. Evans & Associates
BARUCH FISCHHOFF, Carnegie Mellon University
MARYE ANNE FOX, University of Texas at Austin
SHIRLEY A. JACKSON, U.S. Nuclear Regulatory Commissioni
ROBERT I. LEVY,Wyeth-Ayerst Research2
RICHARD.J. MAHONEY, Monsanto Company (retired)
STEVEN L. McKNTGHT,Tularik, Inc.
MARCIA K. McNUTT, Massachusetts Institute of Technology
PAUL M. ROMER, University of California at Berkeley
LUIS SEQUETRA, University of Wisconsin
HAROLD T. SHAPIRO, Princeton University
H. GUYFORD STEVER,Trustee and Science Acivisor
JOHN P.WHITE, Department of Defenses
National Research Council Staff and Consultants
Norman Metzger, Stucly Director
Robert M. Cook-Deegan, Senior Program Officer
Christopher T. HiD, George Mason University
Michael G.H. McGeary, Consultant
Julie M. Esanu, Research Assistant
Danielle Dehmier, Project Assistant
Resigned on July 12, 1995, to become chair of the U.S. Nuclear Regulatory Commission.
2Resigned on March 22, 1995, due to schedule conflicts.
3Resigned on June 22, 1995, to become deputy secretary of defense.
iii
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Preface
In a report accompanying funding for the National Institutes of Health for
FiscalYear 1995, the Senate Appropriations Committee requested a study from the
National Acaclemy of Sciences, the National Acaclemy of Engineering, and the Insti-
tute of Medicine. The stucly was to address "the criteria that shouIct be used in
judging the appropriate allocation of funds to research anal development activities,
the appropriate balance among different types of institutions that conduct such
research, and the means of assuring continuer! objectivity in the allocation process."
The stucly originated from the Appropriations Committee's concern "that at a time
when there is much opportunity to un~lerstancl and cure disease, funding for health
research supported by NTH in the next fiscal year is held to below the inflation rate
for medical research clue to budget constraints. Similarly, other Fecleral research
agencies are confronted with constrained resources resulting from the virtual freeze
in discretionary outlays."
The charge was daunting when it was requested by the appropriations Com-
mittee and is even more so now. With a year's passage, the concern with a"virtual
freeze in discretionary outlays" seems an understatement. The efforts by both the
Administration ant! the Congress to recluce the federal deficit have promptest pro-
posals to cut programs, consolidate or abolish agencies, and even do away with
whole departments. The federal research ant! clevelopment enterprise has not been
exempt from examination, nor should it be. Since the end of World War IT, this
enterprise has become vast and complex, and it accounts for a significant part of the
discretionary outlays of the fecleral government. It is thus important that the nature
and structure of federal support for research and cievelopment, as well as the ben-
efits it brings, be understood! to assure that as budgets are reduced, the strengths of
U.S. science and technology are maintained, while the anachronistic or weak as-
pects are pruned.
The Committee on Criteria for Fecleral Support of Research and Development
approached its task with realism about the budget pressures, an eagerness to pro-
vide advice that couIct guide both the Executive Branch and Congress, and a con-
cern for fairness in evaluating the many parts of the enterprise. The committee's
membership reflected these aims, including inctivicluals who perform federally
funneled research, who use the results in industry and other sectors, who have been
involved in shaping federal research and ctevelopment programs in the past, and
who are students of the research and clevelopment enterprise.
The committee's realism about budget pressures was matched by its realism
about the report's immediate impact on current budgets. It is the committee's hope
that this report will serve well both the executive and legislative branches as they
grapple with the very hard decisions that will have to be made over many buciget
cycles, in a politically and fiscally difficult environment.
The theme of the committee's report is continuance in the face of change.
Continuance builds on the spectacularly successful results of postwar fecleral invest
v
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Vi / PREFACE
meets in research and development. By any measure, these investments have been
recouped many times over in contributing to a strong and globally competitive U.S.
economy, hastening the end of the Cold War, providing continuing national security
against new enemies, advancing the fight against disease, improving our environ-
ment, and producing revelations about ourselves, our world, and our cosmos.
Charge comes in acknowledging that the federal research and development enter-
prise must adapt to a new world. The Cold War is over. Global competition is both
economic and military, involving many more nations than did the past bipolar
confrontation of nuclear superpowers. These problems create opportunities. ]:n-
deed, science and technology will be even more important in the future than they
are today. Change is also reflected in the very doing of science, as computers and
high-speed communication networks expand access to databases and facilities
throughout the world and enable daily collaboration among scientists and engineers
separated by great distances.
Over time, institutions and programs have been created that no longer serve
us well. Even good programs and institutions must give way to successors that are
better and are more closely linked to new national needs. These are painfi~1 mes-
sages. Some of the committee's members have built their professional lives through
programs and institutions that may not survive application of the principles the
committee proposes for judging future expenditures. At the same time, the commit-
tee believes strongly that failure to make these choices will prove costly, serving
neither the nation nor the scientific community. That said, the committee appreci-
ates that its principles for judging programs and institutions are, by necessity, gen-
eral and must be given more specificity when applied to particular programs and
institutions. As a practical matter, the committee did not offer specific details for
implementing the judgments that must be made. The commirre~ h`'li~v`~c char thick
who must make the decisions and execute them should be given the latitude to
apply these principles sensibly.
The report is short, and deliberately so. Part ~ offers the committee's recom-
mendations, with sufficient elaboration to enable readers to understand them. The
four supplements included in Part 11 give details underlying the recommendations.
These supplements are not mere appendixes, but provide background critical to
understanding this brief report. For example, Supplement 2 shows how the com-
mittee derived a new budget index it calls federal science and technology (FS&~.
The committee believes that these federal funds best define the public investment in
the science and technology base that is essential for maintaining U.S. health, pros-
perity, and security.
In addition to the facts and analyses provided in the supplements, the commit-
tee relied on other means for arriving at its judgments, including more than 35
letters received from individuals in leadership positions in industry, academia, and
scientific societies; a number of outreach meetings held around the country; several
commissioned papers; communications through an Internet home page; briefings
by senior government officials whose agencies are collectively responsible for most
of the federal research and development budget; and discussions with many indi-
viduals in the Administration and Congress. The committee is grateful to an who
took the time to provide assistance and in doing so not only tutored us, but also
showed their concern for the future of the U.S. research and development enter
~In__ V_ v ~sA ~w
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PREFACE / Vii
prise. The individuals who assisted the committee and the background papers
prepared for it are acknowledged in Appendixes C and D, respectively.
Some wiR think it politically unwise that we recommend a process and
guiclelines for identifying activities that can be reduces' or eliminated and for
reallocating the savings to ones more essential to preserving US. leadership in
science and technology. We have been told that our advice will be only partially
followed that the cuts wiN be maple but that the savings wiN not be reallocates!
to federal science and technology. Perhaps. But we see no alternative. We can
only hope that the case we have made is convincing, and trust that our recommen-
dations to maintain U.S. strength in science and technology will be accepted. The
committee believes that the political wisdom that created the remarkably successful
U.S. research and development enterprise will endure, driven by the U.S. public's
strong and abiding support for federal science and technology.
This report results from the work of many people. ~ especially thank the
committee itself. it had what some believed a near-impossible task. Whether it
succeeded is for others to judge. T shall always be grateful to these extraordinarily
accomplished and able people for the care, intelligence, and above all the time they
gave to wise and experienced judgments about a federal role that is so vital to the
nation's future. Finally, ~ know T speak for all the committee members in acknowl-
edging our indebtedness to the staff consummate professionals who know as
much about science policy issues as any in Washington, and without whose partici-
pation the report would be much diminished.
Frank Press
Chair
Committee on Criteria for Federal
Support of Research and Development
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Contents
Part ~ Improving the AHocation Process
for Federal Science and Technology
Determining Principles for allocating Federal Funds
Conclusions, Recommendations, and Discussion
Looking to the Future
Encinotes
Part Supplements: Background and Rationale
1 The Evolution and impact of Fecleral Government Support
for R&D in Broad Outline
2 Federal Funds for R&D and FS&T
3 Current Processes for allocating Fecleral R&D Functs
4 interactions Between Fecleral anct Industrial Funding and the
Relationship Between Basic ancIApplied Research
Encinotes
Appendixes
E
A Senate Report Language for the Prospective Stucly
B Committee and Staff Biographical information
Acknowledgments
D List of Commissioned Backgrounct Papers
Acronyms
Nix
8
30
32
41
51
62
70
82
87
88
93
95
96
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