A Failure to Invest – The Third Leg

As September jobless numbers show that enough Americans have given up looking for jobs or have accepted the new “new” employment category of low-pay, insecure tenure and lean prospects for advancement jobs to generate a 5.9% unemployment rate. We have bills we cannot pay – like the $2.7 trillion of unfunded state and local pensions – and investments we don’t want to make – like educating our children to relevant competitive standards (without leaving college students with mortgage-level student loans to sap their limited earning power) and upgrading and repairing our infrastructure to meet our actual needs.

But I’ve blogged about these investment “cuts” a whole lot before. Still, this universal theme – a failure to appreciate the difference between spending and investment (the latter generates a hard economic return) – is a plague that has infected both the American body politic and their elected representatives.

Today, I am focusing that third leg of government investment in our future: research and development (R&D). For all those badly-paid Americans with those fresh, shiny new jobs, consider yourselves lucky. Your government doesn’t care what your future looks like; our rich folks need more tax breaks. Too expensive to create new technologies and scientific solutions that might improve your lot and create new industries.

The “big slam” to university and institutional research funding – that work that keeps us healthy and creates the technologies for solid future jobs – was the 2013 “Sequester” that resulted when Congressional deadlock effected an automatic litany of meat-axe federal budget cuts. Even after some of the cuts were restored, scientific research remained deeply deprioritized. The anti-science bent of a Bible-belt-skeptical House, a rural rebellion against academic and intellectual pursuits and the excuse of a continuing impaired economy led to keeping most of those cuts intact. One of the leaders and distributors of biomedical research grants, the National Institutes of Health, lost $1.6 billion for example.

The immediate impact? According to the March 4^th The Daily Texan (from the University of Texas, Austin): “Viktoria Topper, cell and molecular biology graduate student, said the institute had to reduce funding for existing grants, as well as reducing the number of available grants altogether… ‘Fewer grants were rewarded or renewed, culminating in a loss of about 722 grants for the year,’ Topper said. ‘It also cut down the success rate of grant applications to 16.8 percent, the lowest success rate ever.’”

“On September 16, the Senate Committees on Appropriations and Health, Education, Labor, and Pensions held a hearing to discuss the resources needed to address the [recent challenges from the Ebola outbreak, now generating diagnosed cases in the U.S.]. Sen. Patty Murray (D-Wash.) asked NIH representative Anthony Fauci about sequestration's effect on the efforts.

“‘I have to tell you honestly it's been a significant impact on us,’ said Fauci. ‘It has both in an acute and a chronic, insidious way eroded our ability to respond in the way that I and my colleagues would like to see us be able to respond to these emerging threats. And in my institute particularly, that's responsible for responding on the dime to an emerging infectious disease threat, this is particularly damaging.’…

“Dr. Beth Bell, director of the CDC's National Center for Emerging and Zoonotic Infectious Diseases [whose budget had been sliced and diced], testified before the committee… "If even modest investments had been made to build a public health infrastructure in West Africa previously, the current Ebola epidemic could have been detected earlier, and it could have been identified and contained,’ she said during her testimony. ‘This Ebola epidemic shows that any vulnerability could have widespread impact if not stopped at the source.’" MotherJones.com, October 3^rd. OK, a few more people are going to die (okay, more than a few!), Peter, but what about those cool new scientific technologies that will create manufacturing and engineering opportunities?

Lewis Link, writing for the March 5^th Engineering News-Record addresses both the level of cuts and the likely impact on our Gross Domestic Product: “Research is the seed corn of our economic future, now more than ever with the advent of globalization and economies stimulated by continuous advances in technologies.

“The Information Technology & Innovation Foundation (ITIF) anticipates that ongoing U.S. budget cuts will cause a shortfall in federal R&D spending of about $95 billion by 2021, resulting in a reduction in GDP by up to $860 billion over the same period. That is a decline in GDP of $9 for every dollar reduction in R&D!... That translates into fewer jobs, opportunities lost, and a decline in competitiveness—a negative spiral not easily reversed.

“While universities primarily depend on federal sources of R&D funding, federal R&D expenditures are less than 30% of the total for the country. Since the 1980s industry has been the dominant source of R&D funding, now providing up to 70% of all resources.”

By shifting research to the private sector, the kind of serendipitous developments (think of how many jobs and new technologies came out of NASA in its heyday) that have accounted for so many of the jobs and technologies that define our lives are no longer finding funding. The private sector doesn’t work that way. Only clear paths to clear economically-defined near-term commercial benefits get the vast bulk of the private dollars.” Fewer jobs. We get lsess globally competitive. Lower capacity to pay back our deficit. More research cuts. Less capacity to earn money to pay the deficit. And so it goes.

I’m Peter Dekom, and we have a Congress that seems unable to understand how deeply they are planting the seeds of our own unraveling future.