President Levin Discusses the Implications of Industrial Research and Development Strategies before Senate Panel
Yale University President Richard C. Levin delivered the following opening statement today during testimony in Washington before the Science and Technology Caucus of the United States Senate: Members of the Caucus, thank you for inviting me to discuss this most important issue - the contributions of research to industrial competitiveness.
I am honored to meet with the Caucus, which has done so much to advance a thoughtful discussion in the Senate about the national investment in research. This hearing is well-timed; recent trends in the support of basic research raise serious questions about the health of the research enterprise as well as our long-term national competitiveness.
High technology industries and the basic research that feeds them will continue to be a driving force in our economy. In recent decades, the economy has shifted away from such industries as automobiles and steel, which once served as its backbone, and toward industries in which competitive success depends on the commercial application of new scientific knowledge - software, communications equipment, and biotechnology. America leads the world in these and growing industries, and it will continue to if we invest wisely.
Several factors influence our industries’ ability to develop and exploit new products, including tax policy and federal rules governing the immigration of scientists and engineers. The most important influence, however, is the strength of the basic research that expands the knowledge base that companies have at their disposal.
With that in mind, we have good reason to be optimistic about our national investment in research. The corporate sector remains committed to research and development, as spending rose by 7.7 percent above inflation from 1997 to 1998 alone. Total U.S. investment in research and development now represents 2.61 percent of GDP, its highest level since 1992.
Furthermore, every major research university plays host to an abundance of research opportunities that could have broad implications for new products. Faculty are remarkably productive, and both undergraduate and graduate students hone their own research skills by assisting faculty in science and engineering research. With a greater awareness than ever before of the commercial significance of research, virtually every research university is working harder to see that faculty inventions make their way into the market. Yale has spawned 35 new companies in the past decade from work initiated in life sciences laboratories on our campus; more than half of these are now contributing to the economic development of greater New Haven. Moreover, increasing numbers of students with advanced degrees in science and engineering are pursuing careers in industry, where they add to the creative potential of companies.
Nevertheless, we face troubling trends in the financing of research. Basic research accounts for a small share - an estimated 3 to 6 percent - of industrial research. Industrial funding, in turn, supports only about 10 percent of the basic science conducted on university campuses. We should not be surprised at these trends, for the typical firm has little incentive to make substantial investments in basic research when it cannot predict its ultimate application, and it cannot appropriate the results for its exclusive use and development.
Accordingly, awards from federal agencies support nearly two-thirds of all basic scientific research undertaken at universities, and thus the funding of agency research budgets is of paramount concern to us. The entire university community is grateful to the Science and Technology Caucus for its leadership in supporting the university/government research partnership that we launched over a half-century ago, and we are especially grateful for its efforts in enacting S. 296, the National Research Investment Act.
Some recent developments remain troubling, however. Specifically, other than for NIH and NSF, funding for science agencies has declined in real terms since fiscal 1993. The problem with shortchanging the basic research budget is that it will be many years, perhaps decades before the cost of today’s cutbacks become apparent. The products making headlines today in the life sciences, for example, are the end result of fundamental discoveries in genetics made in university laboratories in the 1960s and 1970s. Similarly, inventions in the physical sciences made three or even four decades ago, such as the laser, continue to find new and commercially important applications even today. If real spending on basic research continues to decline, we will see, slowly but surely, lower levels of innovation and competitiveness in U.S. industry well into the next century.
Protracted periods of stagnated or shrinking budgets also send a chilling message to younger investigators, who may, in turn, fail to secure funding and drop out of research. These trends also discourage students from pursuing a risky career in science and engineering. As a result, talented minds might turn away from careers in research, shrinking further the knowledge base and talent pool that U.S. industry needs to remain competitive over the long term.
I hope that, in the end, the fiscal 2000 budget will reverse the recent decline in funding for physics, computer sciences, engineering, and other fields that have not kept pace in recent years.
Members of the Caucus, thank you for your time. I would be happy to answer any questions that you may have.
Media Contact
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