Can science get by without your tax money?

Times Online ^ | 5 June 2006 | Terence Kealey

[Logophile]

Can science get by without your tax money? Just ask them over at IBM

Science Notebook by Terence Kealey

SCIENCE POLICY across the globe is but a series of footnotes to Vannevar Bush’s 1945 book Science: The Endless Frontier.

Before the Second World War the US Government spent little on applied science and nothing on pure science. In 1940 its total research budget was only $74 million, mainly for defence and agriculture, when the private sector was spending $265million, of which $55 million was for pure science. Yet by 1940 America had long been the richest country in the world, and its researchers, including Edison and the Wright brothers, had transformed the world — on private money. Meanwhile, Einstein flourished at Princeton’s Institute for Advanced Study, which had been privately endowed by the Bambergers with $25 million.

But the Second World War thrust America into funding military science, and by 1945 Vannevar Bush, a brilliant scientific manager, was administering a federal research budget of $1.6 billion, supporting the Manhattan and other projects.

Bush believed that the success of federal science in wartime could be extrapolated into peacetime, so he wrote Science: The Endless Frontier to lobby Washington into maintaining its support. This was because, Bush explained, pure science was a public good that the private sector would not support yet which, paradoxically, the private sector needed if it was to create applied science or technology. Bush sketched out a National Science Foundation to distribute federal funds to university scientists by competitive grants. All science funding agencies across the globe have since been modelled on the NSF.

But Bush also knew that in reality America’s private sector had funded pure science generously before 1940 and in his book he issued a warning that federal money might not just supplement the private money but might, instead, “drive it out” and end up reducing the total spent on research. Has it?

In 2003 the Organisation for Economic Co-operation and Development (OECD) published a comprehensive survey that reviewed all the known factors that could explain the different growth rates of member countries. The report found, unexceptionally, “a significant effect of research and development (R&D) activity on the growth process” (that is, research powers economic growth). But then it found, explosively, that it was only “business-performed R&D . . . that drives the positive association” (only private research powers economic growth).

Even more explosively, the OECD found that the public funding of R&D appeared to damage economic growth because it “crowds out resources that could be alternatively used by the private sector, including private R&D” (ie, the public funding of research does indeed displace the more useful private funding).

Scientists today find it hard to believe — even though they know that there is no real distinction between pure and applied science — that the private sector would fund pure science. But scientists are casuists. Consider the Human Genome Project. We were told that only governments and medical charities would fund it because it was such pure science. But when Craig Venter, of Celera Inc, started to overtake the publicly funded teams, they responded by greatly multiplying their demands on the taxpayer on the ground that the human genome was too important to be left to the private sector.

Contrary to myth, the private sector does tons of science — because it is so profitable. Consider IBM. The Times Higher Education Supplement’s survey last year showed that Harvard University’s science papers are the most cited globally (20.6 citations per paper on average) but coming in second was IBM (18.9), outranking all other universities and research bodies. And because IBM invests so much in science, it has for the past 12 years been awarded more patents (3,000 annually) than any other institution. And by its patents IBM earns more than $1 billion annually in licence fees.

The scientists will not easily surrender their faith in government funding, but because public money crowds out private money it tells us that science is not the public good of Bush’s book. Science is not a field of endeavour on which taxpayers’ money need be spent.

Terence Kealey is Vice-Chancellor of Buckingham University

[Philly Nomad]

And to think Philips is hemorrhaging money now.

As long as industry is funded by wall street backed short term investors, not much money will be placed in long term R&D. It just doesn’t make good business sense.