Science and R&D

In an economy powered by innovation and technology, more proactive R&D policies are key to success.

Federal Funding for R&D: Further Evidence That it is Needed More Than Ever Before
June 18, 2012
| Blogs & Op-eds
Justin Hicks
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In an era of ever tightening budget constraints, some, especially some conservatives now argue that federal funding for research is not critical for innovation. They claim that the private sector will make up for any losses in innovation resulting from a reduction in federal funding of R&D. In the latest edition of the Journal of Policy Analysis and Management (devoted to the examination of science policy and innovation), two scholarly articles clearly rebut this view.

Genius Loves Company
June 11, 2012
| Blogs & Op-eds
Stephen J. Norton
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When Congress takes up corporate tax reform, lawmakers should consider a few ideas from ITIF. First, make clear that process R&D qualifies for the R&D tax credit. Second, Congress should use the tax code to promote more collaboration between companies as well as non-corporate entities.

Taking Stock Podcast - Bloomberg Radio

April 23, 2012
Rob Atkinson appears on "Taking Stock" to discuss innovation and competitiveness.

Rob Atkinson and Vinny Catalano appear on "Taking Stock" to discuss innovation and competitiveness. After ITIF's Innovation Consensus Conference, they reflect on the evident need for policies that advance R&D efforts, reform STEM education, and provide considerable investments for start-ups.

Congress should consider an Investment Tax Credit to provide a credit (at a lower rate) on all capital expenditures made above 75 percent of the base.

Congress should consider establishing an investment tax credit modeled on the Alternative Simplified R&D Credit (ASC). The ASC provides a credit of 14 percent on R&D expenditures above 50 percent of the average firm expenditures of the last three years. An Investment Tax Credit could provide a credit (at a lower rate) on all capital expenditures made above 75 percent of the base (the base would be the average expenditures on qualifying capital equipment over the last three years).

If current R&D investment continues at the current level, the R&D investment deficit will grow to $2.6 trillion by 2021.

If federal R&D investment had been sustained at the 1960-1980 level, in terms of an average share of GDP, these investments would be approaching $230 billion annually today, rather than the current levels of roughly $150 billion. Our robust investment in R&D in the 1960s, 70s and 80s fueled our post-war prosperity and helped set the stage for the IT revolution, advances in biotech and pharmaceuticals and the creation of millions of jobs and companies in the 1990s. Read more »

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Taking on the Three Deficits

A Word from the Wise is Sufficient
October 13, 2011
| Blogs & Op-eds
Stephen J. Norton
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Recipients of the Presidential Early Career Awards for Scientists and Engineers (PECASE) 2011 were unanimous in saying a steady and consistent funding stream helps maintain the country’s brain power and world class R&D infrastructure. It also begins a process that can lead to successful commercialization of ideas and discoveries.

Are We a Nation of Homer Hickmans or Homer Simpsons?
October 4, 2011
| Blogs & Op-eds
Stephen J. Norton
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The 54th anniversary of the launch of Sputnik by the Soviet Union is a good time to take stock of how the country is reacting to the innovation challenges we face today. Beginning almost immediate in the fall of 1957 and continuing through the 1960s, the U.S. made significant investments in science, education, R&D and aerospace and it paid off in the form of new jobs, even new industries. By contrast, when President Obama tried to rally us to make similar investments by declaring a “Sputnik moment” in 2011, we have seen little meaningful change in policy. If anything, the public mood seems to cut public investments. In this blogpost, Steve Norton wonders if part of the problem is a fatigue and defeatism that seems to have infected the national spirit. He says we can and should snap out of it and points to some proposals ITIF has made to step up our competiveness and get us back on the path to innovation-based leadership.

National Science Foundation (NSF) offers the same number of annual graduate research fellowships as it did in 1960s.

The National Defense Education Act, created in 1958 in direct response to the Soviet Union's launch of Sputnik, established graduate fellowships for students on the doctoral track in the sciences. While the particular program is no longer in effect, it and similar programs are widely credited with putting more talent in the pipeline and augmenting U.S. science policy. Today, we are shortchanging the interests of our students and the needs of the nation if we limit support for graduate education in critical fields. Read more »

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Refueling the U.S. Innovation Economy: Fresh Approaches to Science, Technology, Engineering and Math Education.

Growth in federal R&D investment from 1987-2008 was 0.3% per year, vs. 4.9% from 1953-1987, for a current annual shortfall of $60 billion.

Government funding for research played a key role in the technological breakthroughs that helped U.S. industry become global technology leaders World War II. Indeed, federal support of research grew 4.9% per year in inflation adjusted terms from 1953-1987. But with the decline of the Cold War and efforts at budget austerity, the federal government has abandoned its responsibilities to help fund research. Federal investments in research from 1987-2008 grew by only 0.3% per year, 15 times slower than in the prior era. Read more »

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National Science Board, Science and Engineering Indicators 2010

Every dollar of U.S. public funding for medical research increases U.S. private investment in medical research by 32 cents.

Rather than "crowding out" private investment in medical research, as some skeptics of government support contend, public and private medical research are in fact complementary. Basic, early-stage research expands the science knowledge base, laying the foundation for later-stage research and innovation in the future. This is dynamic nature of innovation. Government's role is especially useful early in the process. Although substantial, the benefits of basic research are reaped over the long term and are often shrouded in uncertainty. Read more »

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Everett Ehrlich
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