7: FROM BASIC RESEARCH TO INNOVATION AND ECONOMIC GROWTH

Four related assets support the nation’s innovation system, said Norman Augustine, former chairman and CEO of Lockheed Martin Corporation, in the final discussion of the symposium: knowledge capital, human capital, financial capital, and the broader innovation ecosystem.

Beginning with knowledge capital, the United States devotes only about 0.2 percent of its GDP to federal support for basic research, Augustine pointed out. Yet, economists have shown that much of that GDP is the result of advances in science and technology. “The nation needs to address the balance between investment and consumption,” he said.

Regarding human capital, the United States has the finest research universities in the world—all 5 of the top 5 and 18 of the top 25, according to The Times of London. Yet, states have been disinvesting in public higher education and converting many of their flagship universities to, as Augustine put it, “quasi-private universities, but without the endowments that many private universities enjoy,” even as the federal government has begun taxing the gains on the endowments of some private universities. Meanwhile, according to the World Economic Forum, U.S. K–12 schools ranked 48th in the world on measures of mathematics and science, and the United States ranked 76th in the world for baccalaureate-level degrees awarded in engineering, Augustine said.

Turning to financial capital, total public and private spending for R&D as a percentage of GDP has remained relatively constant for about half a century, even as the role of science and technology in the economy has exploded. At the same time, American industry has shrunk or shuttered most of its finest research laboratories and China has surpassed

the United States in total R&D spending and funds devoted to venture capital. “That should be the stuff of headlines, of presidential debates, but nowhere is it even mentioned,” Augustine said.

Finally, with regard to the innovation environment, many researchers spend about 40 percent of their time preparing reports or proposals that have a 15 percent chance of being funded. Meanwhile, regulatory pressures are driving more and more U.S. companies to establish their research laboratories abroad, even as mismatches between the interests and procedures of universities and industry hinder the translation of new ideas from basic research into new products.

Looking ahead, Augustine concluded that “we’re going to need to streamline the connection between those who fund research, those who do research, and those who apply research. We’re going to have to fundamentally overhaul our K–12 public education system. And we’re going to have to establish an innovation enterprise that could benefit from the talents of all Americans, particularly those who are currently underrepresented…. As we begin this next

“Where are the good jobs in America?” Johnson asked. “They’re in and around science and technology. They’re related to the activities that either you yourselves do or the things that you create, or the things that happen 5, 10, 15 years later because other people seize on your ideas and develop [those ideas] into useful products and services that are sold to the world.” —Simon Johnson, Professor of Economics and Entrepreneurship, Sloan School of Management, Massachusetts Institute of Technology

75 years, we’re starting out under a very different set of circumstances than we were when Vannevar Bush made his remarkable proposal.”

The Case for Increased Federal Research Funding

In providing government funding for research, policy makers want to know the value proposition—the benefits versus the costs. But on this point the evidence is “absolutely clear and very strong,” said Simon Johnson, professor of economics and entrepreneurship at the MIT Sloan School of Management. The social returns on science “are very high,” he said. Though the private returns to companies have eroded somewhat, science remains an extremely good investment for government, both in terms of financial returns and employment. “Where are the good jobs in America?” Johnson asked. “They’re in and around science and technology. They’re related to the activities that either you yourselves do or the things that you create, or the things that happen 5, 10, 15 years later because other people seize on your ideas and develop [those ideas] into useful products and services that are sold to the world.” The argument for increased investment is unassailable, he observed.

But how much should that increase be? According to Johnson’s analysis, “the answer is a lot”—$980 billion over 10 years, which would represent close to a doubling of federal support for research in the United States.

On its current trajectory, government support for science in the United States will gradually decline, Johnson said, despite its previous successes. But other countries better appreciate the possible returns on research, and they are increasing their investments. In a winner-take-all economy, they are likely to get ahead of the United States and generate more good jobs.

Johnson argued not only for increasing federal support for R&D but also for spreading that funding more widely. Many parts of the country, and many colleges and universities, are not much involved in R&D, and they “are

much less convinced that science creates a tide that lifts all boats.” Making science more inclusive and geographically distributed both attracts and generates more talent even as it demonstrates to more people the benefits of science and technology. “That’s what Bush said,” Johnson observed. “You have to find the talent, you have to train the talent, and you have to put the talent together with dollars to make research happen. That’s the same thing we have to do again today.”

Stability Amid Complexity

Shirley Tilghman, professor of molecular biology and public affairs and former president at Princeton University, said that the basic principles described in Science, the Endless Frontier remain valid today, even if “they are no longer sufficient because the world is so much more complicated.” Despite these complications, investing in basic research is still essential, because “there really isn’t a plan B. If the federal government is not investing in fundamental, basic, curiosity-driven research, we will not have the seed corn” necessary for innovation. Similarly, investigator-initiated research remains vital so that people who come up with new ideas are given opportunities to explore those ideas, even as

large projects like particle colliders and the Human Genome Project are needed to advance the frontiers in some fields of science.

A key point on which the Bush report was prescient, Tilghman remarked, was the need to link the education of graduate students to federal funding of research. However, Bush did not foresee a day when graduate training would attract more foreign students to U.S. colleges and universities than U.S. students. While the strength of higher education in the United States is a sign of the quality of the research being conducted, Bush likely would wonder why more U.S. students are not choosing research careers.

Bush once said that “we must educate graduate students to the right amount,” Tilghman noted. That recommendation has been “completely ignored” in many fields of science, where young scientists cannot begin their research careers until they are in their 30s. This “has had profound consequences in how students of this generation look at embarking on careers in science,” said Tilghman. They say, “this doesn’t look like a fair playing field to me.”

The Benefits of a Diversified Research System

Robbert Dijkgraaf, director of the Institute for Advanced Study, said that the next 75 years will be even more exciting than the past 75. The fundamental building blocks of nature are well understood from atoms to genes to bits. “Now we can start building with these building blocks, and clearly this will impact society and our economy even more strongly than in the past 75 years.” Transformational ideas emerging from research laboratories may even reverse some of the negative effects that advances in science and technology have helped produce in the past.

Another reason for optimism, said Dijkgraaf, is that science and technology policy makers have come to realize the importance of a diversified investment portfolio. Research agendas are always susceptible to “regression to the mean,” he cautioned, which can rob research of its vitality, and the United States could still learn important lessons from the ways that other countries have structured their R&D systems. But keeping a research system diversified, rich, and variegated can keep it powerful and effective, he said.

The Diversity Imperative

Freeman Hrabowski, president of the University of Maryland, Baltimore County, cast the central issues of the symposium in a different light. The year 1945 was not a period of optimism for his family or for many

others. In 1945, only 5 percent of Americans had graduated from college. The numbers for women and Black Americans were even lower, and few opportunities for advancement existed for the members of these groups. Though progress has been made since then, the majority of the U.S. population still faces substantial obstacles to higher education and careers in science and technology. As Hrabowski pointed out, even today more than two-thirds of Americans have never had anyone in their family graduate from college.

This lack of opportunities for a substantial fraction of the population undermines trust in science and discourages broader participation in research. “We should be empowered to look in the mirror and be truthful with ourselves,”

Hrabowski said. “When we talk about diversity and inclusion, these are warm and fuzzy terms. We have not brought the rigor of analysis to those issues when talking about the execution and implementation of these ideas, and most important when talking about evaluation.”

This is not a problem only for minority groups, he said. Among Blacks and Latinos, only about 20 percent who intended to major in science or engineering as first-year college students graduated with a science degree—but only about 32 percent of Whites who intended to major in science or engineering did so as well. Furthermore, the more prestigious the university, the higher the attrition. “If we want people to invest in science … we have to pull more people into the work, not because everybody has to be a scientist but to give them a better experience,” he said. With so many people not going to college and so many more leaving science despite their interest in it, “why should they be fighting for science” as adults?

Hrabowski argued for a fundamental rethinking of the educational model, particularly at the undergraduate and graduate levels. Students need the kinds of experiences that keep them in science and prepare them to excel. The scientific community needs “ambassadors” who can attract people into science who would not otherwise have considered that possibility. As part of this process, researchers cannot continue to strive to produce students who are just like them. Over the next 75 years, the faculty at colleges and universities must focus on people “who are different from them. It is the only way we will begin to reflect America.”

Broadening the Definition of Scholarly Value

Finally, Laurie Leshin, president of Worcester Polytechnic Institute (WPI), asked what kinds of pivots higher education needs to make to prepare for the next 75 years. Science, the Endless Frontier called for researchers to be “free intellects working on subjects of their own choice.” But the report also laid out a social contract in which research would produce economic, medical, and societal benefits in return for society’s support. In many ways, that social contract has come to pass, Leshin said, but in other ways it has not. Technologies derived from scientific advances have had unintended consequences.

Confidence among the public in colleges and universities has declined. Academic researchers have tried to pull people up the ivory tower when what they really need to do is come out of the ivory tower and engage with communities. The question now, said Leshin, is how to bring science and STEM education closer to societal needs to strengthen the social contract at the heart of Bush’s report.

One way this is done at WPI, where almost every student receives a STEM degree, is to have all students work on problems that reside at the intersection of science and society and are embedded in communities all over the world. “They learn what it means to solve a problem of societal relevance because they have to go solve one to get a degree from our institution. There’s no answer in the back of the book for that. This is not a homework problem. It’s a real world problem.”

WPI has also revamped its reward system for faculty. As other speakers at the symposium noted, most current systems are focused on rewarding individual investigator research. But some institutions, including WPI, are broadening the definition of scholarship to include translational research, work with communities, and efforts to diversify both the students and faculty in higher education. As one faculty member told Leshin, “We haven’t lowered the bar, we’ve broadened it.” She concluded, “that’s what a truly inclusive environment that values contributions from everyone looks like.”