Are We Underfunding Basic Research in the Physical Sciences?

by George McClure

The eighteen national laboratories within the U.S. Department of Energy (DOE) constitute one of the largest (if not the largest) scientific research systems in the world, while the DOE provides more than 40 percent of the total national funding for physics, chemistry, materials science and other areas of the physical sciences. Many are locally managed by private companies, others are managed by universities, and together they constitute a key component in what is known as the "iron triangle" of military, academia and industry research.

While funding for health sciences has doubled between 1998 and 2003, the physical sciences and engineering have not been nearly as fortunate. Their R&D budgets have been essentially flat for the past 15 years.

By definition, basic research — the systematic study directed toward greater knowledge or understanding of the fundamental aspects of phenomena and observable facts — lays the foundation for later development. Because the return on investment in basic research is slow, private industry prefers to focus on advanced development incorporating the results of such research.

In the defense community, there are seven categories of research, development, test and evaluation (RDT&E): basic research (6.1); applied research or exploratory development (6.2); advanced technology development (6.3); demonstration and validation (6.4); engineering and manufacturing development (6.5); RDT&E management support (6.6); and operational systems development (6.7).

Basic research generally includes applied research. At the Department of Defense (DOD), basic research currently comprises less than two percent of total R&D.

Downward trend for basic research

Requested budget authority for basic research in the president’s FY 2006 budget totals $26.6 billion, down $320 million, or one percent less than the $26.9 billion requested for 2005. But more than half of this total ($15.2 billion) goes to Health and Human Services for health research. The National Science Foundation is budgeted at $3.5 billion — mostly for university research — and thus not available for the national labs. Veterans Affairs is allocated $315 million, partly for Superfund transfer. Dropping out all three of these lines leaves $7.6 billion (see “Basic Research” in Table 5-2, below), down six percent from 2005.

In the president’s FY 2006 budget, the Advanced Technology Program (ATP) is zeroed out of the Commerce Department budget for the National Institute of Standards & Technology (NIST); it was funded at $140 million in 2005. Since the program’s inception, just six percent of the ATP portfolio has yielded $17 billion in economic benefits — eight times the total ATP investment.

The Hollings Manufacturing Extension Partnership (MEP) funding is cut by 56 percent or $60.7 million, to $46.8 million. In 2003, according to NIST, MEP generated $4.1 billion in new and continuing sales, and was responsible for creating and retaining 50,315 jobs.

The president’s budget does provide for making permanent the Research and Experimentation (R&D) 20 percent Tax Credit, which had previously been subject to incremental extensions. The purpose is to stimulate private R&D through tax incentives that can be counted on to continue. The added cost in 2006 is $2 billion, rising to $7.7 billion in 2010, or $27.2 billion for the whole period.

NASA’s overall R&D budget is up five percent, as it begins to plan missions to the moon and Mars [www.nasa.gov/pdf/107490main_FY06_Direction.pdf], but its basic research budget is down seven percent, as the focus moves away from aeronautics research.

Aeronautics Technology consists of three integrated programs: the Aviation Safety and Security program mitigates actions that cause damage or loss of life; the Airspace Systems program enables revolutionary improvements to the National Airspace System; and the Vehicle Systems program, which has been restructured to emphasize breakthrough technologies and demonstrations, works to reduce aircraft noise, support development of zero-emissions aircraft, and develop Uncrewed Aerial Vehicles (UAVs) for Earth and space science missions.

NASA's FY 2006 request for aeronautics research is $852.3 million, including:

• $193 million for Aviation Safety and Security (a four percent increase above FY 2005) to decrease aviation accident and fatality rates

• $200 million for Airspace Systems (a 32 percent increase above FY 2005) to provide technologies that can dramatically increase the capacity and mobility of the nation’s air transportation system [www.nasa.gov/pdf/107493main_FY_06_budget_summ.pdf].

Commercial aviation has benefited greatly over the years from government-funded research, first from the National Advisory Council for Aeronautics, and then (since 1958) through its successor, NASA [http://naca.larc.nasa.gov/?method=about]. The jet engine itself is a good example [www.afmc.wpafb.af.mil/HQ-AFMC/PA/news/archive/2003/Sep/0903-03.htm].

DOE manages a significant portion of the nation’s R&D enterprise through its program offices. DOE’s Office of Science (SC) is the single largest supporter of basic research in the physical sciences in the United States. SC also manages research at 10 national laboratories and the world’s most diverse portfolio of unique and powerful scientific tools — including particle accelerator centers, neutron sources, high-powered light sources, advanced computational centers, and atmospheric monitoring facilities. In addition, DOE, through the Office of Science, funds more than 7,000 individual research projects at universities, national laboratories, and in U.S. industry and the non-profit sector [www.doe.gov/engine/content.do?BT_CODE=ST_SS16].

Table 5-2 Federal Research and Development Spending

[http://64.225.252.6/html/budget/2006/FY06RDChapterFinal.pdf]

Newer initiatives

Two programs highlighted in the R&D budget are nanotechnology research and hydrogen research.

Nanotechnology R&D: The budget provides $1 billion for the multi-agency National Nanotechnology Initiative (NNI) [www.nano.gov]. The NNI focuses on R&D that creates materials, devices and systems that exploit the fundamentally distinct properties of matter as it is manipulated at the atomic and molecular levels. The results of NNI-supported R&D could lead to breakthroughs in disease detection and treatment, manufacturing at the nanoscale level, environmental monitoring and protection, energy production and storage, and creating electronic devices that have even greater capabilities than those available today.

Guided by the NNI, participating agencies will continue to focus on fundamental and applied research through investigator-led activities, multidisciplinary centers of excellence, education and training of nanotechnology workers, and infrastructure development, including user facilities and networks that are broadly available to researchers from across the scientific research community. For example, the 2006 Budget provides funding for DOE to complete construction on four new major nanoscale science research centers located around the country. In addition, agencies continue to maintain a focus on the responsible development of nanotechnology, with attention to the human and environmental health impacts, as well as related ethical, legal and societal issues.

Hydrogen R&D: In 2004, the Hydrogen R&D Interagency Task Force, established by the Office of Science and Technology Policy, initiated a plan to coordinate agency efforts in key research areas, such as novel materials for fuel cells and hydrogen storage, inexpensive and durable catalysts, and hydrogen production from alternative sources. In 2005, the task force will implement this plan and expand public outreach and collaboration with the private sector, state agencies and other stakeholders. The United States, through the Department of Energy, will continue to lead the International Partnership for the Hydrogen Economy, established in 2003 to coordinate hydrogen research among the 15 nations that together consume two-thirds of global energy.

DOE will continue the President’s Hydrogen Fuel Initiative to accelerate the worldwide availability and affordability of hydrogen-powered fuel cell vehicles. Including an 11-percent increase in targeted basic research investments in 2006, to $260 million, the initiative focuses on research to advance hydrogen production, storage and infrastructure. The Initiative complements the Department’s FreedomCAR Partnership with the auto industry, which is aimed at developing viable hydrogen fuel cell vehicle technologies [www.eere.energy.gov/hydrogenandfuelcells/presidents_initiative.html and www.whitehouse.gov/omb/pdf/overview-06.pdf].

One could argue that fundamental research is close to being a pure "public good" and that government financing is justified. (Ref. 1) The case is clear in the case of public health, but less clear in other applications. The deferred payoff likely keeps private investors from undertaking some risky research, and industry is adept at taking the fruits of research from government labs that developed them and applying them in products or processes.

But, when the government cannot fund all meritorious basic research, it often assumes the role of gatekeeper, thereby influencing the technology winners and losers. What is happening with the National Nanotechnology Initiative and the Hydrogen R&D initiative today closely mirrors the industry-government cooperation of nearly 30 years ago with the semiconductor consortium Sematech [www.sematech.org/corporate/history.htm].

Research report cards

The current budget aims to cut the federal budget deficit in half over five years. The administration is employing a program assessment tool to help accomplish this goal.

In restraining spending in the 2006 Budget, the administration was guided by three major criteria:

First: Does the program meet the Nation’s priorities? The Budget increases funding to strengthen our Armed Forces, improve our homeland defenses, promote economic opportunity and foster compassion.

Second: Does the program meet the President’s principles for appropriate use of taxpayer resources? If an appropriate federal role could not be identified in a program’s mission, the Budget proposes to reduce or eliminate its funding.

Third: Does the program produce the intended results? The President’s Management Agenda (PMA) has been in existence for nearly four years. As a part of the PMA’s Budget and Performance Integration Initiative, the Program Assessment Rating Tool (PART) measures the success of programs in meeting goals. It also identifies which programs are achieving their intended results and which are not. PART can help determine when two programs that perform similar tasks produce starkly different results — and helps the administration to reward only those that succeed, thus reducing redundancies in the federal government. For programs that have achieved their desired results, and do not merit continued funding, the administration has recommended eliminations.

References

Wolf, Martin, Why Globalization Works, p.63, Yale University Press, 2004

George McClure is chair IEEE-USA's Communications Committee, a member of the IEEE-USA Career & Workforce Policy Committee, and technology policy editor for IEEE-USA Today’s Engineer. Comments may be submitted to todaysengineer@ieee.org.