Investing in the National Research Initiative: An Update of the Competitive Grants Program in the U.S. Department of Agriculture (1994)

This is the technological age. It is also an age of opportunity. U.S. agriculture continuously evolves, but the pace of change is now more dramatic than ever. In the life sciences, new knowledge and instrumentation are rapidly expanding the understanding of plants, animals, and microbes; providing new opportunities to control disease and pests; and improving the quality of agricultural and food products. Equally complex changes are occurring in international trade, where the new rules of the global marketplace are transforming old patterns of competition.

In the agricultural system, as with other segments of U.S. industry, the problems of the twenty-first century intensify more quickly than ever before, and opportunities must be seized immediately, before their peak of potential benefit has passed. The ability of the United States to resolve the spectrum of issues and related problems in agriculture—nutrition, economics and international trade, production efficiency, natural resources conservation, control of pollutants, and others—depends on depth of knowledge, the available tools and technologies, and the skill and insight to apply them.

The United States needs to invest in the future—in human capital and the scientific knowledge base—to revitalize and reinvigorate one of its leading industries, the agricultural, food, and environmental system, in its broadest sense. A sound investment strategy for research is fundamental to sustain economic performance, to respond competitively to the increased economic strengths and manufacturing capacities of other nations, and to maintain the

U.S. quality of life. The commitment called for in this proposal should therefore be part of a national agenda to strengthen the United States.

Major challenges confronting the nation now center on the competitiveness of U.S. agricultural products in global trade, the safety and quality of the U.S. food supply, and the management and sustainability of the country's natural resources.

The United States faces new and aggressive competition from abroad. The balance of trade has gone from positive to negative, making the United States a debtor nation. The strong role that agricultural exports played in the U.S. balance of payments has weakened. U.S. global competitiveness in agricultural commodities and food products has eroded because of increased costs of production at home and heightened competition from foreign producers in the marketplace. Given the high U.S. production capacity, regular surpluses of major commodities, and the imperative of deficit reduction, the needs for profitable new uses for agricultural products, more costefficient production, and new markets remain high.

Nutritious and high-quality food is available to U.S. citizens. However, problems are arising that must be resolved, such as excessive fat in the diet, the incidence of microbial contamination, and pesticide residues on food.

U.S. citizens consume too many saturated fats. Although red meat and dairy products provide 36 percent of food energy and 100 percent of certain nutrients, they also contribute more than half of the total fat, nearly three-fourths of the saturated fatty acids, and all of the dietary cholesterol in the U.S. diet (National Research Council, 1988a). Agricultural research is focusing on ways to produce leaner animals and to process nutritious foods with reduced levels of saturated fats and cholesterol.

Salmonella species and Campylobacter jejuni from all sources are each responsible for up to 2,000 cases of gastroenteric disease per 100,000 people per year in the United States (National Research Council, 1985a). Illnesses caused by these microorganisms tend to be most severe among the very young, the very old, or patients with immunosuppressive diseases. New research can determine points at which known pathogens enter the food supply and can contribute to improving methods for detection, monitoring, and control.

Although potential cancer risks from ingesting pesticides in the diet are small in comparison with the potential risks from other known causes of can-

cer, the pesticide residues on fruits and vegetables are a growing public concern. Research can provide new insights into levels of dietary risk and can identify new alternatives that will ensure the producer a high-quality crop while reducing the need for pesticide application.

Concern for prudent natural resources stewardship and a clean and sustainable environment is now focusing on issues such as contamination of surface water and groundwater by natural and chemical fertilizers, pesticides, and sediment; the continued abuse of fragile and nutrient-poor soils; and suitable disposal of municipal, industrial, and agricultural wastes.

Water pollution is probably the most damaging and widespread environmental effect of agricultural production. Various estimates of the potential financial costs of surface water contamination from agricultural production are in excess of $2 billion per year. Groundwater is the source of public drinking water for nearly 75 million people. This fact is significant because accumulating evidence indicates that a growing number of contaminants from agricultural production are found in underground water supplies. Although research is being conducted in these areas, a major increase in support will be required to adequately investigate and apply new knowledge and technologies to curtail surface water and groundwater contamination.

Soil erosion remains a serious environmental problem in parts of the United States, even after 50 years of state and federal efforts to control it. New data indicate that the intensive tillage practices associated with continuous monoculture or short crop rotations may make soils more susceptible to erosion. New knowledge will provide improved ways to estimate erosion, decrease the displacement of soils by wind and water, and develop federal policies for conserving fragile lands.

Waste disposal facilities all over the United States are reaching their capacities to contain and decompose plant and animal residues, pesticides, food processing wastes, sewage, and industrial sludges. Research in the agricultural, food, and environmental sciences can help minimize the production of waste materials, develop technologies to increase recycling, and develop improved systems for ecologically safe waste disposal systems.

Solving the problems of competitiveness, a high-quality food supply, and natural resources and the environment will require much more new knowledge than was required to solve previous problems. An example illustrates the point: genetically engineered biocontrol agents for pest management are now being designed on the basis of current knowledge, but it will likely take a 10-fold increase in understanding of the biology of such agents and their sur-

vival and action in various ecosystems before such engineered biological control agents can be effectively developed and used. The knowledge needed must come from a number of disciplines, such as biochemistry, genetics, physiology, plant pathology, entomology, plant biology, ecosystems analysis, agronomy, and economics, among others. The specific disciplinary knowledge must then be integrated into effective production systems. The knowledge required far transcends that necessary for the current chemical-based technologies.

The necessary new knowledge is unlikely to be acquired and expediently applied without substantial new funding.

This proposal for investment in research for the agricultural, food, and environmental system aims to establish the new knowledge base necessary to address the problems.

The purpose of this proposal—as well as the challenge it presents—is to mobilize the nation's scientific and engineering communities to advance the quality of agriculture, the food supply, and the environment.

This proposal presents a program to strengthen the focus of U.S. science on agriculture. The premise is that a judicious but substantial increase in research funding through competitive grants is the best way to sustain and strengthen the U.S. agricultural, food, and environmental system.

Implementation of this research proposal will

• Capture the proven high economic return on investment in agricultural research.
• Secure for agricultural research a full array of talent from the entire U.S. science and technology research sector.
• Expand knowledge in all the disciplines underpinning agriculture while also contributing to advances in other broad areas such as biomedicine, ecology, engineering, education, and economics.

This proposal, which is composed of the following specific elements, should be evaluated as a singular strategy for action.

This competitive grants program should be increased to support the need for research in public and private universities and colleges; not-for-profit institutions; the U.S. Department of Agriculture's (USDA's) Agricultural Research Service. Economic Research Service, and U.S. Forest Service; and other research agencies of the state and federal governments.

Funds should come from new monies, not from the redirection or reallocation of existing research and education programs, including formula-funded programs.

Agriculture has vastly overgrown its early bounds of planting and harvesting crops and nurturing livestock as sources of food and fiber. It is a major influence on and component of industry, world trade, and global ecology. The six program areas establish a framework that will accommodate all areas of research relating to agriculture, food, and the environment. Research in the six program areas using all relevant disciplines of science and technology is essential to solve current and emerging problems.

Examples of some of the major topics within the six program areas are as follows.

• Plant Systems: plant genome structure and function; molecular and cellular genetics and plant biotechnology; plant-pest interactions and biocontrol systems; crop plant response to environmental stresses; improved nutrient qualities of plant products; and new food and industrial uses of plant products.
• Animal Systems: cellular and molecular basis of animal reproduction, growth, disease, and health; identification of genes responsible for improved production traits and resistance to disease; improved nutritional performance of animals; and improved nutrient qualities of animal products.
• Nutrition, Food Quality, and Health: microbial contaminants and pesticide residues related to human health; links between diet and health; bioavailability of nutrients; postharvest physiology and practices; and improved processing technologies.

• Natural Resources and the Environment: fundamental structures and functions of ecosystems; biological and physical bases of sustainable production systems; minimizing soil and water losses and sustaining surface water and groundwater quality; global climatic effects on agriculture; forestry; and biological diversity.
• Engineering, Products, and Processes: new uses and new products from traditional crops, animals, by-products, and natural resources; robotics, energy efficiency, computing, and expert systems; new hazard and risk assessment and mitigation measures; and water quality and management.
• Markets, Trade, and Policy: optimal strategies for entering and being competitive in overseas markets; new decision tools for on-farm and in-market systems; choices and applications of technology; and new approaches to economic development and viability in the rural United States and developing nations.

Principal investigator grants should support individual scientists or coinvestigators working within the same, or closely related, disciplines. Principal investigator grants are the foundation of the highly successful competitive grants programs in the United States, and they are the major way to attract and retain talented scientists and their students into areas of research.

Fundamental multidisciplinary team grants should support collaborating scientists from two or more disciplines focusing on basic science or engineering questions. It is often at the juncture of disciplines that new discoveries and research strategies are made.

Mission-linked multidisciplinary team grants should support multidisciplinary research focusing on more applied problems of national significance and should be linked to, among others, the Cooperative Extension Service (CES), the Agricultural Research Service (ARS), and industry. Funding through this grant type will facilitate the application of knowledge and the transfer of technology to the user through joint research-extension studies.

Research-strengthening grants should competitively support institutions through program grants and individuals through fellowships to increase the U.S. research capacity.

The significance of multidisciplinary research to the success of the competitive grants program cannot be overemphasized. Many fundamental scientific and technological questions—and certainly the more applied problems—are multifaceted. To deal with their inherent complexity and diversity, it is necessary to establish multidisciplinary grants and make them a major feature of the expanded program.

Research-strengthening grants are essential for two reasons. Grants to institutions improve the research capability at institutions and in departments that aspire to, but have not attained, nationally recognized research and development (R&D) capabilities. Fellowships increase the training and experiences available to pre-and postdoctoral fellows in agricultural, food, and environmental research. Expanding the number of women, underrepresented minorities, and disabled individuals in the research system must be integral to the entire program. The research-strengthening grant is a major way to provide those opportunities. The grants are not intended to be used for buildings or major capital expenditures.

The size and duration of awards reflect the capability of a program to attract top-quality scientific and engineering talent. The USDA Competitive Research Grants Office should award grants that are adequate to conduct effective research and that are comparable in size and duration to those awarded by the National Science Foundation (NSF) and the National Institutes of

Health (NIH), the two institutions in the United States with the largest and most successful grants programs. The proposed changes in size and duration will attract more top scientists in a variety of disciplines and thus increase the capacity to educate their students—the nations future scientists.

Key parts to the rationale for the expanded program include the need for a federal initiative; the need for a large increase in funding; the justification for new money, not for the redirection of current funds; the suitability of USDA as the central agency for the expanded program; and the appropriateness of competitive grants as the funding mechanism.

A federal initiative for increased research support is needed because the issues and fundamental research needs are national in scope, and the nation as a whole, not just a state or region, is the beneficiary. In addition, states lack the funding to advance basic science across the full range of areas requiring immediate attention. In the private sector, the rate of R&D growth, which has been strong since the mid-1970s, is likely to level off in the decade ahead, and it may decline somewhat. Moreover, private sector research is focused on creating opportunities to market products and services, whereas much of the research most important to society and the nation is not market-related.

A $500 million increase in research funding is justified for at least three major reasons. (1) The pervasive needs and problems require large amounts of new knowledge and technology for their resolution, as discussed earlier. (2) Agricultural research provides a high return on investment. (3) The agricultural research system, as presently funded, is unable to provide the necessary financial support for the quality, amount, and breadth of science and technology necessary to address the problems.

Agricultural research characteristically gives a high annual return on investment, more than 45 percent (Fox et al., 1987). The contributions of research conducted within the competitive grants program will, in addition, bring advances not only to agriculture, food, and the environment but also to other scientific disciplines and other sectors of society. Discoveries that were made in efforts to resolve agricultural problems have already led to major advances in biology and medicine. Findings from research with plant models, for example, will lead to advances in the understanding of basic genetics and gene expression. Over time, the research results and their application will significantly decrease both regulatory and environmental costs.

Adequate funding through the six proposed program areas must be available to support the best and brightest researchers currently working in agriculture and to attract top researchers in other disciplines who have not previously participated in USDA programs. Current funding cannot do either.

Researchers' proposals for scientific inquiry are currently funded at levels that are too low to meet the demands of high-quality science. The average annual grant size from USDA is $50,000, in contrast to average annual grant sizes of $71,300 from NSF and $154,900 from NIH. USDA grants average 2 years in contrast to 3 years or more for NSF and NIH. In addition to funding grants at a higher level, both NSF and NIH fund a much larger number of grants. In fiscal year 1988, USDA awarded approximately S40 million for competitive grants, in contrast to the $265 million awarded by the Directorate of Biological, Behavioral, and Social Sciences at NSF and the $632 million awarded by the National Institute for General Medical Sciences (NIGMS), which is only 1 of the 12 institutes of NIH. All of the institutes that make up the NIH together awarded $6.4 billion in competitive research grants in 1988. Research supported by NIGMS is broad, covering all areas of fundamental biomedical science that bridge the responsibilities of all the institutes within NIH. Research supported by the USDA's competitive grants program is narrow, covering only some of the six program areas recommended in this proposal.

The proposed increase of $500 million would expand the current competitive grants program level of $50 million to an annual total of at least $550 million. The overall $550 million program should support the following four types of grants:

1. About 800 principal investigator grants for an average duration of 3 years. Total annual expenditure: $250 million.
2. bout 180 fundamental multidisciplinary team grants for an average duration of 4 years. Total annual expenditure: $150 million.
3. About 60 mission-linked multidisciplinary team grants for an average duration of 4 years. Total annual expenditure: $100 million.
4. Research-strengthening grants to institutions for programs and to individuals for fellowships. Total annual expenditure: $50 million.

The expansion of USDA's competitive grants program by $500 million from its current level of $50 million will enable USDA to significantly support the innovative science that is poised to proceed—as soon as funding can be obtained.

Support of the competitive grants program with new money will reverse the consequences of no R&D growth in agriculture and sustain the state-federal partnership.

The publicly funded research system has not been able to investigate many scientific questions comprehensively because fiscal constraints have allowed little, if any, real growth in R&D expenditures. From 1955 through 1988, research funding for USDA remained virtually stable in constant dollars, corrected for inflation. The purchasing power actually decreased, and higher costs are associated with the potent but costly instruments and supplies required by today's researchers. In 1988 USDA's total annual R&D funding was only 4.6 percent of the total R&D funded by the federal government, exclusive of the Department of Defense. Unfortunately, the lack of growth in USDA's support for R&D from 1955 through 1988 did not allow sufficient advancement in scientific knowledge. The agricultural sector cannot progress under the current level of funding; it can only fall behind.

The lack of real growth in R&D expenditures during the past 30 years has slowed research within U.S. agriculture and other areas of science. Opportunities are missed, such as the relatively slow application of biotechnology to agricultural issues; problems have increased, such as the need for new uses for commodity crops and for improved new crops for better nutrient composition and postharvest quality. At the same time, however, science and technology in other countries are advancing rapidly. Without a new infusion of funds, there will be insufficient support for the talented researchers with new ideas that can refuel scientific advancement in U.S. agriculture. Furthermore, without new funding, prospective students and new Ph.D. graduates will not be attracted to careers in agriculture or retained in them.

Most states support research at land-grant universities and state agricultural experiment stations (SAESs) far in excess of the matching formula funds they receive from the federal government. A substantial portion of this state support goes to research on fundamental scientific problems of national importance. Increased federal support for competitive grants will ease that burden and allow more of the state funds to be used for problems specific to that state or region.

Redirection of funds from intramural or formula-based programs to competitive grants would be counter-productive. The delivery system—SAES scientists and extension specialists and advisers, in combination with government and the private sector—is already unduly stressed, and redirection would exacerbate staffing insufficiencies for ARS, CES, and SAESs.

USDA is the federal agency responsible for advancing the agricultural sciences and developing technology applicable to food, fiber, and forest product industries. It is the entity best suited to administer the agricultural, food, and environmental competitive grants program.

The competitive grants program will warrant status as an independent office within USDA's Office of Science and Education, setting its administrator on a par with the administrators of the Agricultural Research Service, Cooperative State Research Service, and Extension Service as the managers of USDA's science, education, and training activities. As the USDA competitive grants program grows from about $50 million to $550 million in annual awards, changes in administrative procedures and institutional relationships will be essential.

The competitive grant is the proven and appropriate mechanism to stimulate new research in high-priority areas of science and engineering. It is flexible, reaches a large pool of talented scientists, and provides a balance to the overall research program, thereby ensuring high-quality research.

Responsiveness and flexibility in altering the direction of exploratory research are critical to scientific excellence. A competitive grants program capitalizes on the skills and experiences of leading scientists in recognizing the need for new directions in science. Because funding commitments to any one project are for only 3 to 5 years, this mechanism is flexible and responsive to rapid advancements in science, thereby allowing resources to be targeted at the most promising areas of scientific research in each grant cycle.

Sufficient funding over an adequate period of time is the best way to attract talented scientists from a variety of disciplines. The expanded competitive grants program will more adequately support researchers within the agricultural research system and will also open the system to scientists from other disciplines who have not previously participated in the USDA grants program. These scientists should be, but are not now, applying their skills to agricultural research.

An expanded competitive grants program will provide the needed balance among the funding mechanisms that support USDA R&D: intramural programs, formula funding, special grants, and competitive grants. Competitive grants are a significant source of funding within other federal agencies. At NIH and NSF, 83 and 90 percent of R&D support, respectively, is distributed through competitive research grants. At USDA, however, less than 6 percent of R&D support is so distributed. USDA should not attempt to mirror NIH and NSF in the proportion of funds it distributes on a competitive basis. Problems specific to certain crops, technologies, and regions are often best addressed

through formula funds or special grants. Long-range research, such as the development of improved plant and animal germplasms, or tracking of the diets and nutritional status of a group of children as they grow, for example, are more effectively supported on a continuing basis through intramural funding. With full funding of this proposal, the annual investment in R&D by USDA would rise to $1.54 billion from $1.04 billion (Office of Management and Budget, 1989), and the $550 million in competitive grants would then account for approximately 35 percent of USDA's research expenditures.

The recommendation for a major increase in funding of competitive research grants for agricultural, food, and environmental research comes at a time of overall fiscal constraint for the nation. Elected and public officials must reduce the national debt and at the same time set priorities among competing federal expenditures to enact programs that maintain the welfare, infrastructure, security, and continued economic growth of the United States. As a part of that they must also address public concerns for maintaining global competitiveness, the safety and nutritional quality of the food supply, and environmental resources. The goal of reducing expenditures while allocating funds for essential programs thus requires fiscal prudence.

Political leaders will need to consider the proposal for an increased commitment to agricultural, food, and environmental research against a background of potential trade-offs. What are these trade-offs?

• The additional $500 million could come from sacrificing other USDA research programs. Can some current research programs be discontinued in an effort to strengthen competitive grants research?
• The necessary funds could be directed to research from other USDA budget categories. Commodity price supports, for example, have decreased from $26 billion to $11 billion during the past 3 years, as U.S. agricultural export prices have improved. Should $500 million of those savings and future budgetary savings be redirected toward research, toward reducing the national debt, toward a combination of the two, or toward progress outside of agriculture?
• The funds could be shifted from other parts of the federal budget into USDA. Does the consistently high return on the agricultural research investment override the need for funds in other areas of national interest?

• The investment in agricultural, food, and environmental research can be deferred until deficit reduction has been achieved. But investing new funds now can hasten future economic and scientific benefits. What will be gained—or lost—by postponing the investment?

For the past 25 years the USDA budget for research has not increased. Actual monetary increases have barely kept up with inflation. In 1965 the USDA research budget had the purchasing power of $788 million in 1982 dollars; the 1988 research budget was valued at $778 million in 1982 dollars. In reality, any past changes in agricultural research priorities had to come from the redirection of funds within the research budget. Further redirection by increasing the investment in competitively awarded grants does not address the problem of the continued federal underinvestment in research through USDA. It also raises the real risk of destroying some of the ''muscle'' of current high-quality research in intramural and formula-funded research in attempts to cut out any "fat."

Without some real growth in the USDA research budget, there can be no realistic opportunity to broaden the scope of science contributing to agricultural, food, and environmental research. Many of the new scientific opportunities that require costly supplies and instrumentation will have to remain unexplored, and few multidisciplinary research teams will be able to be formed to attack the multifaceted problems of competitiveness, food quality, and natural resources confronting agriculture.

The proposed increase in funding for competitive research grants is justified. This proposal stands strongly against reallocation within the USDA research budget for the reasons given above. If no growth in the USDA research budget is possible, then decisions to redirect funds are judgments that elected and other public officials may choose to consider.

As U.S. agriculture gradually returns to a state of economic health and as commodity prices return to free-market conditions, the federal budget appropriations currently used for price support programs may be targeted for budgetary savings. Part of these savings should be reinvested in research programs to strengthen the knowledge that supports the nation's food and fiber industries.

Investments in agricultural research in the United States have consistently shown high returns, as noted previously. Such data demonstrate that an in-

creased investment in the agricultural, food, and environmental research system will be paid back rapidly in economic development and other public benefits.

The U.S. gross national product in 1987 was $4.5 trillion (Council of Economic Advisers, 1989). Of that, the agribusiness complex contributed approximately 18 percent, or roughly $815 billion (Harrington et al., 1986). The current annual federal investment in agricultural R&D is about $1.04 billion—less than 0.13 percent of agriculture's annual contribution to the gross national product.

A major increase in research funding of $500 million is needed at this time. The scientific opportunities exist today to use this increased funding wisely. The needed scientific talent is available now, primarily through the nation's existing scientists in the physical, biological, engineering, and social sciences, as well as those in agriculture and related disciplines, who are ready to compete for this new funding. In addition, as noted above, increased funding will also ensure the flow of young scientists into agriculture-related research areas.

To achieve the maximum effect, this substantial increase should be enacted in a single year as a reflection of the value of the broadened scope of agricultural, food, and environmental research and the importance of the sustained advancement of this system to the U.S. economy.

Given the overall fiscal problems facing the nation, the appropriation of the full $500 million increase may not be possible in a single year. Even so, a commitment of this magnitude is essential. Any stepwise increase in funding should provide the full increase as soon as possible, preferably within 3 years, and be balanced to address the needs and opportunities in agriculture, food, and the environment.

Agriculture is the world's oldest and largest industry, and it has been a highly successful industry in the United States. The United States is endowed with perhaps the world's most extensive and abundant complement of soils, water, and climate favorable for agricultural production. Still, several other countries have tremendous natural assets to draw upon in developing productive agricultural industries. One dominant factor stands out in making possible the remarkable pace of development of agriculture in this country in contrast to that in other countries—the early and very strong support given to agriculture by the U.S. government. Agriculture was the first—and for a long time, the major—federally supported scientific effort. It is significant that early federal

support was not directed primarily toward infrastructure investments that yielded only quick benefits. Rather, support was broad, and a large proportion was directed toward research and education.

The decision to provide federal support for a strong U.S. agricultural system was made by the Congress 127 years ago through the Morrill Act of 1862. Now is the time to make a renewed investment in U.S. agriculture, one that will ensure its worldwide leadership role in the coming decades.

As a leader, the United States calls upon its agricultural and food system to compete in a free-market world. But U.S. farmers cannot compete with the price of labor in many countries, where it is far lower than that in the United States. And, for the same reason, they cannot compete with the cost of fertile land in other countries. The single resource that U.S. farmers can draw upon to capture the leading edge is science and technology. The U.S. government must help to provide an environment where U.S. producers and processors can compete. The most effective way to ensure a strong U.S. agricultural system is to capitalize on science and technology by investing strongly in agricultural, food, and environmental research.

Council of Economic Advisers. 1989. Economic Report of the President. Washington, D.C.: U.S. Government Printing Office.

Fox, G., R. Evenson, and V. Ruttan. 1987. Balancing basic and applied science: The case for agricultural research. Bioscience 37:507–509.

Harrington, D., G. Schluter, and P. O'Brien. 1986. Agriculture's Links to the National Economy. Economic Research Service, Agriculture Information Bulletin No. 504. Washington, D.C.: U.S. Department of Agriculture.

National Research Council. 1985. Meat and Poultry Inspection: The Scientific Basis of the Nation's Program. Washington, D.C.: National Academy Press.

National Research Council. 1988. Designing Foods: Animal Product Options in the Marketplace. Washington, D.C.: National Academy Press.

Office of Management and Budget. 1989. Budget of the United States Government. Special Analysis J. Washington, D.C.: U.S. Government Printing Office.