THE WHITE HOUSE
Office of Science And Technology Policy
________________________________________________________________________
For Immediate Release June 15, 2000
FACT SHEET
NEW COMPREHENSIVE STATE-BY-STATE REPORT DETAILS
HOW FEDERAL R&D INVESTMENTS DRIVE U.S. ECONOMIC
PROSPERITY AND PRODUCTIVITY
"Our passion for discovery, our determination to explore new scientific
frontiers, and our can-do spirit of technological innovation have
always driven this Nation forward. This report provides concrete
evidence that sustained investments in research can ensure that America
remains at the forefront of scientific capability, thereby enhancing
our ability to shape a more prosperous future for ourselves, our
children, and future generations while building a better America for
the twenty-first century."
President Bill Clinton
June 15, 2000
The Federal government invests over $80 billion in research and
development each year. Our partners in the national S&T enterprise --
industry and academia -- have roots in virtually every community across
the nation. That is where we put Federal R&D investments to work. We
have long known that publicly-funded R&D activities have enormous
payoffs at the national level. These investments enable our nation to
compete successfully in the global marketplace, protect our environment
and manage our natural resources in a sustainable manner, safeguard our
national security from emerging threats, and spur the technological
innovation that has contributed so much to our economic prosperity and
quality of life.
We see the fruits of Federal R&D innovation every day. Many of the
products and services we have come to depend on for our way of life in
America -- the Internet, the Global Positioning System (GPS), lasers,
computers, magnetic resonance imaging (MRI), teflon and other advanced
materials and composites, communications satellites, jet aircraft,
microwave ovens, solar-electric cells, modems, semiconductors, storm
windows, genetic medicine and biotechnology, and many others -- are the
products of Federal R&D investments made over the past 50 years. These
innovations also mean jobs and economic prosperity for America.
This unique report provides clear evidence of the payoffs that R&D
investments have at the state and local level, as well as how they
ripple through regional and local economies and spur the growth of high
technology start-up companies and improvements in local schools.
Research and Development in the 50 States. At the request of the White
House Office of Science and Technology Policy, RAND has prepared the
most comprehensive and detailed information to date on the nature,
magnitude, and location of the individual activities that comprise the
Federal government's R&D portfolio. Discovery and Innovation: Federal
Research and Development Activities in the Fifty States, District of
Columbia, and Puerto Rico is an extraordinarily comprehensive 650 page
report that taps the RaDiUS (Research and Development in the United
States) database to put a human face on the Federal R&D enterprise.
This groundbreaking effort identifies the individual laboratories, R&D
centers, universities, and companies where people actually create new
knowledge and develop innovative new technologies. It enhances our
appreciation of the local and regional significance of Federal R&D
activities. To ensure the comparability of all of the data used in the
report from the most aggregate to the most detailed level of analysis,
the most recent data available is from 1998, the baseline fiscal year
used throughout the report. For eight years in a row, President
Clinton and Vice President Gore have proposed increased R&D
investments. For FY 2001, the civilian R&D request is $43.3 billion,
an increase of 6 percent ($2.5 billion) over FY 2000. Civilian R&D now
constitutes 51 percent of the overall R&D budget of $85.3 billion -- up
43 percent since 1993. The budget boosts funding for basic research by
7 percent, a $1.3 billion increase -- up 52 percent since 1993. R&D
support to universities increases 8 percent, a $1.3 billion increase --
up 53 percent since 1993. Perhaps most important, this budget presents
a balanced R&D portfolio which recognizes the interdependence among the
scientific disciplines -- gains in one field are often dependent on
advances in others. These investments will enable Federal agencies to
achieve the President's goals for science and technology, namely to:
promote long-term economic growth that creates high-wage jobs; sustain
a healthy, educated citizenry, harness information technology; improve
environmental quality; enhance national security and global stability;
and maintain world leadership in science, engineering, and
mathematics.
What's new and important in this report:
-- For the first time in one document, there is a full and accurate
accounting of all Federal R&D expenditures in each of the 50 States,
the District of Columbia, and Puerto Rico.-- It makes it possible to
correlate Federal R&D investments with improvements in local economies
and local schools. --On a state-by-state, unit-by-unit basis, it
provides detailed budget information for each of the individual
laboratories, research centers, universities, and companies that
perform R&D. -- It provides descriptions of the substantive nature of
the research, rather than simply categorizing research expenditures by
broad scientific discipline.
The value of such new detailed information:
-- The Executive Branch can use the information to improve
coordination and better assess performance and results of our R&D
investments. RaDiUS has enabled researchers in different agencies to
learn of work on related R&D problems being tackled by other agencies.
Such information can help Federal agencies plan intelligently and
better leverage R&D investments. It also adds a new dimension --
impacts on State and local economies -- to measuring the effectiveness
of the Federal R&D investments that typically emphasize support of
government missions and advancement of knowledge across the scientific
frontiers. -- Congress can use the information to improve its
oversight of the Federal R&D portfolio; detailed descriptions of
research projects make it possible to better examine the R&D
portfolio. -- State and local officials can use the information to
identify new opportunities for State-Federal S&T collaboration, and to
target regional and community economic development efforts.
How this report differs from others:
-- RaDiUS is the first data system that systematically links the
high-level R&D information presented annually in the President's budget
to the hundreds of thousands of actual studies, experiments, and
analyses conducted by scientists with Federal R&D funds. As a result,
RaDiUS provides the most complete picture of Federal activities
involving the conduct of R&D ever available.-- The National Science
Foundation's (NSF) annual Survey of Federal Funds for Research and
Development provides highly aggregated data at the national and
international levels and limits descriptions of research to general
academic fields of science or engineering. -- The American Association
for the Advancement of Science (AAAS) series, The Future of Science and
Technology in the States, describes some activities in selected states,
relying heavily on the NSF survey results.
The bottom line:
-- Every State in the nation has seen a boost in its economy and
improvements in local communities -- from jobs to schools -- as a
result of Federal investments in science and technology. This report
shows how and why it happens, and underscores why the United States is
in the front ranks of research and innovation, thereby enhancing our
ability to shape and improve our nation's and the world's future.
Stakeholder Interests in this Report
-- Half of all states each receive half a billion or more Federal R&D
dollars yearly. While there is substantial regional concentration
(fifteen states receive about 80 percent of Federal R&D investments),
for many smaller states, Federal R&D support is a significant
percentage of the total Federal non-entitlement funding coming into
those states. Similarly, for many smaller states, Federal R&D funding
on a per-capita basis is higher than in larger states with a greater
level of R&D expenditures.
-- Analysis shows little overlap in Federal R&D portfolio. When the
Federal R&D portfolio is examined by task or research focus, as RaDiUS
permits, rather than by discipline, the full scope of Federal activity
is shown. While many Federal agencies may share a common interest in
particular areas of R&D, there is little duplication among Federal
agencies; instead, various agencies are tackling different aspects of a
common problem.
-- The Executive Branch and Congress will find this report valuable.
The elements of the Federal R&D portfolio span 24 Federal agencies and
annually account for approximately 14 percent of all discretionary
government spending. Discovery and Innovation adds a new dimension --
local and regional economic and educational improvements -- to the
assessment of Federal R&D performance which has historically emphasized
support of specific government missions and the overall advancement of
science and technology in the United States. This report shows
American taxpayers how, where, and why their public investments in R&D
are made. Such detailed information helps our elected officials guide
investments and ensure accountability.
-- State and local officials will also benefit. Discovery and
Innovation is the first comprehensive effort to better inform States
and local communities about the Federal R&D programs within their
boundaries, and will help improve Federal-State cooperation in science
and technology. Currently, 19 states in areas that historically have
received lesser amounts of Federal R&D funding participate in the
Experimental Program to Stimulate Competitive Research (EPSCoR)
designed to strengthen the research capability of their colleges and
universities, and thus to increase our total scientific potential.
Why R&D Is Important to the Nation
The credit for America's record-breaking performance in the current
world economy really goes to the powerful system we have generated to
create new knowledge and develop it into technologies that drive our
economy, guarantee our national security, and improve the health and
quality of life. We have come to rely on technology and take it for
granted in our everyday lives. But the marvels of today are really the
fruits of research seeds planted decades ago -- investments that have
not only given us new technologies, but have helped educate generations
of engineers and scientists who now form an essential component of our
workforce. The very fact that these advances required decades of
investment stands as a warning against complacency in our future
investment strategy. The government and the private sector must work
together to ensure that today's investments in R&D are sufficient to
yield similar payoffs to society in the 21st century.
Last spring, Federal Reserve Chairman Alan Greenspan repeatedly
cited an unexpected leap in technology as primarily responsible for
the nation's sparkling economic performance. In particular, a
technology-based surge in productivity appears to be contributing
substantially to our economic success. Our military strength -- built
on a foundation of high technology -- has enabled the United States to
keep America safe from aggression, defend our allies, and foster
democracies across the globe. New technologies also improve the
quality of our lives. Medical research in pharmaceuticals,
biotechnology, and medical devices promises us a healthier life.
Environmental research offers cleaner air, water, and soil through
better monitoring, prevention, and remediation technologies. Advanced
monitoring and forecasting technologies -- from satellites to
simulation -- help save lives and minimize property damage cause by
hurricanes, blizzards, and other severe weather. Agricultural research
yields a cornucopia of safer, healthier, and tastier food products.
Automobile research leads to cars that are safer, cleaner, more
energy-efficient, and more intelligent. Energy research delivers
cleaner fuels and reduces American dependence on foreign resources.
Information and telecommunications technologies enable instantaneous
communications across the globe.
The largest R&D budget in history for FY2001. President Clinton's
FY2001 S&T budget includes a $2.9 billion increase in the "Twenty-First
Century Research Fund," including a $1 billion increase in biomedical
research at the National Institutes of Health and double the largest
dollar increase for the National Science Foundation in its 50 year
history. These investments will ensure that science and technology
will continue to fuel economic growth and allow Americans to lead
longer, healthier lives. These investments also will enable America to
continue to lead in the 21st century by increasing support in all
scientific and engineering disciplines, including biomedical research,
nanotechnology, information technology, clean energy, and
university-based research.
Fully half of our economic productivity in the last century is
attributable to technological innovation and the scientific research
that supported it. The knowledge-based society of the 21st century
only increases the importance of research, innovation, and human
capital as our principal strengths. By sustaining our investments in
research, we ensure that America remains at the forefront of scientific
capability, thereby enhancing our ability to shape and improve our
nation's and the world's future.
R&D investments pay rich dividends to the Nation. It is no accident
that our country's most productive and competitive industries are those
that benefited from sustained Federal investments in R&D -- computers
and communications, semiconductors, biotechnology, aerospace,
environmental technologies, energy efficiency. From satellites, to
software, to superconductivity, the Federal government has supported --
and must continue to support -- exploratory research, experimentation
and innovation that would be impossible for individual companies or
even whole industries to afford. These partnerships in pursuit of
innovation enable the private sector to generate new knowledge and
adopt novel technologies that ultimately lead to commercial success,
increased jobs, and healthier and more productive lives for all
Americans.
Investments in Federal R&D have extraordinarily high rates of return.
Economists estimate that private rates of return on R&D spending
average about 24 percent. But societal rates of return on R&D spending
-- the economic benefits that accrue to the entire society -- are about
66 percent! As much as half the return on an individual firm's R&D
investment goes to other companies and competitors -- not to the
investing company. This "spillover" effect means that private industry
cannot and will not commit the level of resources to R&D that is best
for society. As a consequence, public support for R&D had been a
critical element of Federal policy for more than 200 years, and it has
kept our nation at the forefront of technological and industrial
success.
American prosperity in the 21st Century. With rapid growth, increased
productivity, and rising standards of living, the U.S. economy is
thriving, in large part because of our technological leadership.
Science and technology have become the engine of America's economic
growth: information technology alone accounts for 1/3 of U.S. economic
growth, and is creating jobs that pay almost 80 percent more than the
average private-sector wage. Many of the technologies (such as the
Internet) that are fueling today's economy are the result of government
investments in the 1960s and 1970s.
Longer, healthier lives for all Americans. In the last 100 years, the
life expectancy of the average American has increased by almost 30
years, as a result of breakthroughs such as antibiotics. Today, we are
on the verge of even greater scientific advances, and continued
investment in health-related research could lead to greater life
expectancies and better quality of life.
Educating America's high-tech workforce. The President's investment in
university-based research will help spur innovations in new
technologies and treatment, while preparing the next generation of
leaders in science, engineering and technology.
Cleaner energy for a cleaner environment. Research can help America
create cleaner sources of energy and energy-efficient technologies,
such as fuel cells that emit only water, cars that get 80 miles per
gallon, and bioenergy derived from new cash crops.
New insights into the world around us. Increases in funding for
science-based research can lead to amazing breakthroughs in our
understanding of the world around us and beyond.
Discovery and Innovation: Federal Research and Development Activities
in the Fifty States, District of Columbia, and Puerto Rico is available
at:
http://www.whitehouse.gov/WH/EOP/OSTP/html/radius.html
and at:
http://www.rand.org/publications/MR/MR1194