The U.S. budget for FY 2015 is being prepared and
universities are worried (as we all should be).
Last week, 165 university presidents in the United States sent an open
letter to President Obama and Congress urging continued strong funding for
education, here. The letter is part of
an effort led by the Association of American Universities and the Association of Public and Land-Grant Universities, see www.innovationdeficit.org. The website includes a fact sheet outlining the
“Innovation Deficit.” It states:
·
Over the last ten years, U.S. R&D
expenditures as a share of economic output have remained nearly constant in the
U.S., but have increased by nearly 50% in South Korea and nearly 90% in China.
(Source: NSF S&E Indicators 2012, Figure O-3)
·
From 1996 to 2007, R&D expenditures in the
U.S. grew by an average of 5.8% annually. During the same time period,
China’s average annual growth was 21.9%. During the first year of the
economic slowdown (2008-09), U.S. expenditures decreased slightly while China’s
increased by 27%. (Source: NSF Indicators Figure O-4 and Overview)
·
Between 2000 and 2008, the number of engineering
doctorates awarded in China more than tripled to 15,000. This compared to
a total of 8,100 in the United States, of which only about 3,200 went to U.S.
citizens and permanent residents. (Source: NSF Indicators Figure O-10)
·
According to the OECD, government R&D spending
between 2000 and 2009 increased by 250% in Korea and 330% in China; U.S.
government R&D spending increased by about 45% during the same period.
·
From 1987 to 2008, federal R&D investment
grew at just 0.3 percent per year in inflation-adjusted dollars—much lower than
its 4.9-percent average annual growth rate from 1953 to 1987—and ten times
lower than the rate of GDP growth over that period. (Source: http://www2.itif.org/2012-leadership-in-decline.pdf)
·
The United States spent up to 17 percent of
discretionary spending on R&D during the 1960’s, in part due to the space
program, which resulted in a great deal of spinoff innovation; in recent years,
outlays have fallen to around 9 percent of the federal discretionary budget. (Source:
http://innovationtaskforce.org/docs/Benchmarks%20-%202012.pdf)
·
In 2008, China awarded 1 million first
university degrees in natural sciences and engineering, up from 280,000 in
2000. That same year, the total number of first university degrees in natural
sciences and engineering awarded in South Korea, Taiwan, and Japan (330,000)
exceeded the 248,000 earned by U.S. students, despite the considerably larger
U.S. population. (Source: NSF Indicators p. O-7)
·
The proportion of U.S. Patent and Trademark
Office patent grants given to U.S. entities declined from 55% in 1995 to less
than half in 2010. (Source: NSF S&E Indicators 2012, Appendix Table 6-45)
·
The percentage of U.S. gross domestic
expenditures on R&D funded by the government declined from 47.1% in
1981 to 33.4% in 2011. The U.S. trails nine OECD nations in this percentage. (Source:
OECD)
These statistics paint a disturbing picture—especially if
this trend continues. And, if you examine
the preview document prepared by the Association of University TechnologyManagers (AUTM) titled, “American Universities: Unsung Heroes of the Economic Recovery” (August 5, 2013) that may provide a clue to the solution to a slow
growing economy, you may become even more concerned.
The AUTM document provides a glimpse at the upcoming Annual Licensing
Survey that will be released in full in December of 2013. The preview document states that:
Institutions responding to the survey reported $36.8 billion
in net product sales from licensed technologies in fiscal year 2012. In
addition, startup companies formed by 70 institutions employed 15,741 full-time
employees. This was the second year in which AUTM asked questions specifically
targeted at ascertaining the economic impact of academic technology
transfer.
"When people think about job creation, they don't
typically think about universities, but the data show that universities
substantially contribute to the creation of new jobs in this country,"
adds Flanigan.
Highlights of the AUTM U.S. Licensing Activity Survey: FY2012 include:
22,150 total U.S. patent applications filed (+11.3%)[;] 14,224
new patent applications filed (+7.2%)[;] 5,145 issued U.S. patents (+9.5%)[;] 5,130
licenses executed (+4.7%)[;] 1,242 options executed (+7%)[;] 483 executed
licenses containing equity (+16.1%)[;] Total license income: $2.6 billion
(+6.8%)[;] 705 startup companies formed (+5.1%)[; and] 4,002 startups still
operating as of the end of FY2012 (+1.9%).
Back in 2001 when President George W. Bush first took office, I remember reading an article about how his administration
planned to cut federal spending on R&D.
I remember thinking someone needs to get educated about what is
happening with federal R&D funding because they are going to make a big
mistake (for many reasons). Within a few weeks, the Bush
Administration announced that they were not going to cut spending in that
area. I hope we find the Obama
Administration pushing hard for more spending on R&D. We need to "feed that Pig."
Let’s assume that we do the right
thing and "feed the Pig." Could the
Obama Administration do more than just provide federal funding for R&D? One idea that has been floated has been the
creation of a federal system of universities, “India’s Bold Solution to the US College Crisis: Federal Universities.”
This is an intriguing idea that may inject some needed “umpf” into the
U.S. university system for R&D.
Perhaps the federal universities could be built around specific
technologies—places where innovation could quickly take place in a system that
quite rationally does not change quickly.
As I blogged about before, perhaps something like the Cornell project in NYC, but without a lot of baggage. Greater wealth—and
maybe some help for wider distribution of it. Something
to think about.
I suspect Obama is going to be remembered for gridlocked government and his inability to play Washington politics as well as he could have done. He's a clever articulate person but unable to reach across political divides. Ultimately a president needs to somehow bring everyone on board, and he seems unable to do that.
ReplyDeleteIn regard to funding of R&D, this needs to be placed in the wider context of the US no longer being able to spend as it could in the past. At some point the reality of its debt will hit home, and competitors such as China, will take the lead in certain sectors.