Current MIT boss Rafael Reif and former Intel boss Craig Barrett make the case in the FT today that the sequester’s across-the-board cuts to federal research spending would be a “mistake” and “further weaken the most powerful stimulant of economic growth ever devised.”
Reif and Barrett cite a number of data points to make their case:
- From 1989 through 2009, federal R&D grew at 1.3% a year vs. 2.4% for GDP.
- Sequestration would immediately cut R&D by 5% to 7% with “stagnation” afterward.
- The US ranks 8th among OECD economies in government R&D spending.
- A report by the Information Technology & Innovation Foundation finds a decade of sequester cuts to research spending would “reduce GDP by $200bn – and that estimate compares sequestration to a scenario where R&D merely remains at the 2011 rate. If in those nine years the US instead kept R&D spending constant as a proportion of output, the economy would be $565bn bigger. And if it invested in R&D at the same rate as China, that gap would grow to $860bn.”
After the sequester kicks in, I would certainly recommend restoring and even greatly expanding federal science spending, though no blank checks. Emphasis should be given to basic research in hard science of the sort Reif and Barrett emphasize rather than the social sciences. I would also like to see an expansion of science and innovation prizes, which seem to be an effective way of leveraging the capabilities and BS detection systems of the private sector.