The Great Debate
02:22 May 5th, 2009

President Obama’s three percent solution

Tags: General, , , , ,

Jonathan Hoganson– Jonathan R. Hoganson is the deputy executive director of the Technology CEO Council, a public policy advocacy group that includes the CEOs of Intel, HP, Dell, Applied Materials, EMC, Motorola, Micron Technology and IBM. He previously was the legislative director for Rep. Rahm Emanuel and policy director for the House Democratic Caucus. The views expressed are his own. –

A few years from now, when our economy has regained its stride, we may look back to a little-noticed announcement last Monday that spurred the resurgence. Amid swine-flu hysteria and First 100 Days hoopla, President Obama quietly announced a commitment to spending three percent of the U.S. GDP on science research and development.

This is a profoundly important step, but if we are to continue to lead the world, the United States must also develop a comprehensive policy to foster innovation. For too long, the United States has lived in a “next month” mindset when it came to our economy. This short-termitis has led to sub-prime lending, credit card debt and a general lack of long-term planning. And in no place has this been more evident than in the sciences.

For the past decade our spending on research and development has been anemic at best, and beginning in 2005, federal funding of academic research actually began to decline. This was happening at the same time our overseas competitors were increasing their commitment. For example, China has increased its R&D spending by an average of 17 percent each year in an effort to catch and surpass developed nations’ spending.

Currently, the United States ranks seventh among developed countries in R&D spending as a ratio of its GDP. Is that a recipe for continued economic and technology leadership?

There is, in fact, a direct correlation between R&D and scientific leadership. As the commitment to science ebbed, so did the U.S. share of worldwide patents and research articles in peer-reviewed journals. And R&D has been proven to catalyze economic growth and enable comparative advantage for developed companies and economies.

Now is the time to make technology and innovation a cornerstone. In the last three months we have made a good start, making broadband, health-care information technology and green tech key components of the stimulus package. The president has proposed a 10-year extension of the R&D tax credit to give businesses the incentive to continue to invest in cutting-edge technologies and products. By advancing these initiatives, we are developing the foundation of a national innovation strategy, but Congress must work with the president to advance a comprehensive strategy.

In recent years, countries such as Germany, France, Japan, New Zealand, Finland, Australia, Denmark, and Australia have established or expanded agencies to promote technology and innovation. While the United States is unlikely to create a new agency, the White House can develop an inter-agency strategy that will restore America’s preeminence as the world’s leader in innovation.

This strategy could synergize the Obama administration’s efforts in clean energy, broadband, and health reform, with new initiatives in education and R&D. It could also develop a system for partnering with venture capital to foster entirely new companies and industries. At the same time, we could remove non-tariff trade barriers, enforce international agreements, open new markets and provide a globally competitive corporate tax structure. All of these are crucial components of any inter-agency innovation strategy.

The last time our government put this type of concerted effort into scientific research was President Kennedy’s challenge to land a man on the moon by the end of the 1960s. Not only did we achieve that goal, it also spawned a generation of scientists and technologies that shaped the 1980’s and 1990’s. What followed was an era of Internet, communications and medical advances that spurred an unprecedented period of economic prosperity.

President Obama’s bold commitment to R&D carries an important reminder that the 1960’s space race was more than a demonstration of increased federal funding; it was a comprehensive strategy to ensure that America led the world. The president seems willing and able to replicate that success today; Congress and industry need to work with his team to make this happen. It’s time for America to take another giant leap for mankind.

Best Comment

May 5th, 2009
12:30 pm EDT
We do need research and development, but not at the government or college lab level. We need it where it is pointed toward a useful product or service. Just funding positions so someone can publish something moves at a snails pace. We need incentives for innovation and patents in order to recover from the serious production and brain drain on the country. We have serious environmental and energy problems and these cannot be solved by government research.
-Posted by f belz

46 comments so far

May 5th, 2009 10:00 pm GMT - Posted by norman zelvin

Until Obama was elected, the last decade and longer saw the growth of a political animus to intellectual activity such as would inspire and generate the growth of interest in new technological R and D activity. The capable and ambitious have been caught up in entertainment, sports,and finance lured by large financial rewards. The politically generated anti intellectualism and poor educational system countrywide has left us without the educated newcomers and resources to inspire and generate the ideas for the R & D programs, the quivalent of the JFK “moon shots”.The question now is how to turn it around.

May 5th, 2009 9:37 pm GMT - Posted by Daniel

Just look at the backers behind this guy.
Corporate members of the U.S. chamber of commerce.

Since when have they done anything except strive to ensure their upper management make an even higher multiple of the line worker.

Really, haven’t we seen thru these shills.
Folks, how’s your career going? your retirement?
Then look at them. Golden Parachutes as far as the eye can see.

They have ZERO credibility in my book. If they propose something it is surly meant to benefit primarily them.
Oh wait, there’s a crumb worker….scramble for it!

May 5th, 2009 8:06 pm GMT - Posted by The Real Deal

@Leonard Zane

It is just about too late for the US to revive the SSC. Too late scientifically, too late technologically, and too late financially.

The LCH at CERN (which the US has invested about $0.5B, participated in design, and will play a vital role in analysis and theoretical work) is *it* for at least the next 2 decades. There are sound scientific grounds not to consider another super collider for this period of time. Therefor the next collider is for the next generation of physicists, assuming there are still physicists and that kind of money around in 2020!

But not to worry. There are many challenges of the highest order to conquer, such as:
- nuclear fusion power generator
- national electric transportation grid
- next generation Internet

And the biggest challenge of them all - getting people highly educated and interested in knowledge, discovery, creativity, all NOT for the sake of money.

May 5th, 2009 6:32 pm GMT - Posted by Magic Dragon

‘You can fool some of the people some of the time, but not all the people, all the time!’
The one problem Governments have, is educated people. We don’t believe! Why? We’ve been lied to so many times, we don’t believe you anytime!
This is why, in the past, Governments, in the case of Nepal a monarchy, didn’t allow children to go to school.
People are much easier controlled if stupid!
But, I’m afraid ‘the genie is out of the bottle’ in the U.S. And there’s more trouble ahead for Governments (as people wise up)!
And it appears from these comments many Americans have already!
‘Citizens of the world unite! You have only your own corrupt government to lose!’

May 5th, 2009 5:13 pm GMT - Posted by D Sakarya

Who is going to do all this R&D?
Get set for more H1-B visas because American don’t do Math.

May 5th, 2009 4:17 pm GMT - Posted by Michael Ham

Eron, when again was this 8 years of low taxation? I’m 23 years old and not one week of my life has their been low taxation in the United States.

May 5th, 2009 4:09 pm GMT - Posted by Michael Ham

Good post Billy, I myself am always astounded when I see so many people who have complete faith in this government. Republican or Democrat, never produces anything good.

May 5th, 2009 4:07 pm GMT - Posted by Kim

The USA , in the past , has very much relied on importing it’s creativity and innovation . It did this by providing a very attractive country - a free and rich country and a place where people could achieve their aims . Internally , however , the society is very corporatist - with culture - such as team playing - that actually runs against producing creativity and innovation . The Bush era particularly has seen a massive attack occur by it on the USA thus greatly negating the attractiveness of it as a country . With this reality strongly in place the question is whether this current situation will be addressed - or whether it will be ignored and the previous techniques of spin , propaganda and myth be used .

May 5th, 2009 4:06 pm GMT - Posted by eron

I love the “goverment doesnt need to do X” statements. Fact is the big wigs have had 8 years of low taxes marketplace freedom and they did nothing but squander the USA’s leadership for there own gains.

No, the problem is NOT a lack of education, the problem can be summed up by a recent post I read by a MIT student which boiled down to “Do I wanna scrap by begging for R+D money or do I wanna be in the million club before im 25?”

We need to give all those Math Guys a reason to quit Wall street and get back into R+D and this is a good start to that end

May 5th, 2009 3:56 pm GMT - Posted by Billy

A few years from now, when our economy has regained its stride? How is it supposed to regain it’s stride when they have pledged to print as much money as the entire value of all wealth in the world? (Approx 10 trillion)

You should have said: a few years from now, after the dollar is completely bankrupted and traded out for the Amero for a horrible exchange rate, after the majority of American jobs are outsourced for foreign slave labor, and after Obama concedes nearly all regulation to international entities in violation of the US Constitution - when the economy regains its stride it won’t matter because the average US citizen still won’t have a job, or any rights.

Besides all that, the government admittedly withholds technology for approx. 30 years before releasing it to the public. So any gains they make won’t see their way to helping the public, and chances are they’ve already made those gains and are withholding them anyway.

May 5th, 2009 3:49 pm GMT - Posted by D

The mistake that Ann and her disciples make is to assume that research is profitable over a short time span. It is not. It takes years of basic (theoretical) research across many simultaneous projects to get even one idea that might be commercially successful after years of further development. The success rate is low and most scientific progress is incremental.
Science is not to be done for profit, but for knowledge. Negative results are as important as positive. That requires long-term commitment and government funding.

The development phase is the one in which private enterprise can benefit by publicly funded science to make profitable businesses. However, this development cannot occur without painstaking scientific research.

May 5th, 2009 3:33 pm GMT - Posted by Tom Johnston

I am all for a 3% R&D budget based on GDP. However, part of these monies should be dedicated to a marketing effort to educate our politicians and the public on the ‘truths’ regarding some common falsehoods. For example, people and politicians should be told definitively that ‘Clean Coal’ technology is nonexistent and not at all possible in the foreseeable future (+20 years); Using corn to feed America’s energy needs and Hybrid tech vehicles instead of feeding America’s people; The current ‘Green Movement’ must be made aware of the true carbon footprint of current alternative and mainstream energy sources, and the true carbon footprint must reveal development, production and operational carbon footprint expenses (this will reveal what energy solutions are most eco-neutral). Alas: coal, solar and wind and not Earth friendly! We should also demand that part of this 3% go towards educational needs for tomorrow’s scientists and technicians.

May 5th, 2009 3:23 pm GMT - Posted by Alex

Finding this of interest, I have “Googled” this person, finding bio info at his Council web site. Here you find background information COMPLETELY lacking any mention of either science or technology background. It tells me he is a well connected political appointee/politician.

I for one having worked on the Apollo Moon Landing Program find his article nothing more than a continuation of political rhetoric to be ignored. Nothing in the returned web bio page tells me that he has a even a clue about the subject. When will we place scientists and engineers in these positions?

May 5th, 2009 3:21 pm GMT - Posted by Jim

Ann, your outrage would be believable if only you had demonstrated similar outrage during the last no-tax-and-spend republican administration, the very people who got us into this economic mess in the first place with policies like the ones you espouse. Sorry, but your hair brained ideas have been debunked over the past eight years and, sadly, you and your political cohort still don’t seem to get it.

May 5th, 2009 3:09 pm GMT - Posted by Benny Acosta

Government does indeed have a place in R & D. Supposedly, government represents the interests of the citizen. If this is true, then government should indeed serve the public interest by making R & D available outside the market place.

The the technology generated by the marketplace serves itself. There’s always a hook designed to chain you to consumption. That’s the reason patents and trade secrets exist. They’re around to force you to spend your resources paying someone else to do what you could do yourself if you had the knowledge and the means. That’s great if you own the trade secret or the patent. It sucks if you’re the one forced to comply with them because you don’t have the resources or connections to stand against them.

But it doesn’t have to be that way.

May 5th, 2009 2:26 pm GMT - Posted by Michael Ham

Ann, what a wonderful post that was, thank you for your insight.

Gov’t doesn’t need to spend one dollar on R and D, get rid of the income tax and drop the corporate rate to 10-15% and you’ll see the most spending in this area in history.

May 5th, 2009 2:02 pm GMT - Posted by Leonard Zane

Complete the Supercollider particle accelerator project, in Waxahachie, Texas, that Congress abandoned in 1993. This will restore American leadership in world physics, will unlock the secret of gravity, and will pave the way for revolutionary forms of space travel and other scientific achievements as yet undreamed. If this is not done, leadership will be retained and accelerated by Europe’s CERN in Geneva (also creator of the World Wide Web), and other world powers will widen significant strategic gains over the United States.

http://www.answers.com/topic/superconduc ting-super-collider

$20 BILLION TO REVIVE THE SUPERCONDUCTING SUPERCOLLIDER

1.
• 20,000 Jobs
• The SSC would have 4 times the energy of CERN’S Large Hadron Collider (LHC), would unlock the greatest secrets of quantum mechanics, and restore America’s global lead.
• The USA would discover what gravity is, and be first in the world to explore potentials of that discovery.
• The SSC will lead the world in developing a Periodic Table of Subatomic Particles, that the current Standard Model of Particle Physics is unable to do.
• With gravity understood and subatomic particles comprehensively explained and related, a Grand Unified Theory (GUT) of forces and fields will be created.
• Quantum Mechanics will be united with Relativity, the “Theory of Everything” (TOE) dreamed of by Stephen Hawking and Albert Einstein will be achieved.
• Jobs, productivity, and inspiration for moving ahead will be stimulated, together with incalculable spawning of new technologies and socio-economic progress.
2. The enormous practical applications of discoveries enabled by the Supercollider — in energy breakthroughs, in quantum computing, nanotechnology, space applications, and medicine and healthcare, too — are beyond our present ability to even conceive; but these exciting potentials are there, are real, and America should be first to discover them and once more lead the world!

3. Where John F. Kennedy led America to the moon and beyond, Barack Obama can lead us and the world to the greatest scientific strides in history.

May 5th, 2009 2:02 pm GMT - Posted by Benny Acosta

How about looking into how to create an automated economic system that distributes “money” equally amongst the population while maintaining it’s value?

It’s not quite so strange when you consider that we already do it now. Our money has no real value. It’s only as good as our belief in “the good faith and trust of the American Government”.

Point is, we already work for worthless money and pretend to “buy” stuff with it. Why not simply take it the next step and completely remove the human being from the accounting process, and remove profit as a motive? Automate the distribution of this fake wealth we already give value to. Prioritize every human to be of equal value and priority, and “businesses” or “community projects” would be able to form organically. Since every individual would contribute their own ability to acquire resources to the task at hand, the only real requirement for being able to “make things happen” would be an adequate number of willing participants. And since there would be no economic anchor (paycheck) people would not be economically forced into doing things they no longer believe in. Thus projects and businesses would only be staffed by people who really believed in the value of what they were doing.

Things would still get done. But they would only get done if people agree to pitch in. Otherwise people still have a limited economic ability to fulfill their own goals. And because the economic system operates independent of central human control, there is no easy way to co-opt or disrupt the system.

I have absolutely no idea how such a thing would be done. But the fact that it CAN be done, is in my humble opinion, worth looking into.

May 5th, 2009 1:10 pm GMT - Posted by The Real Deal

So 3% of government budget on R&D.

What happened to the massive private sector spending on R&D? Clearly, that has not worked, or produced sufficient results, which has contributed significantly to economic downsizing.

Why? As Mr Hoganson said - short term thinking. By who? Everybody blames the executives but in reality it’s the whole American culture.

Why again? Because US lacks the kind of highly educated people doing direct research and supporting the primary researchers.

It all goes back to a general dumbing down, which has been going on for some 2 decades.

Question: Do you think, gov spending research money while private sector won’t, on a people who has failed in R&D, will suddenly produce results?

Even in the best scenario, it will take a generation, a new generation of people. Yes, 3% of budget every year, a highly improbable proposition itself, and there might just be some serious results 20 years from now. And that assumes the population have refused to be dumbed down.

This is the price of generational economic stupidity.

May 5th, 2009 12:30 pm GMT - Posted by f belz

We do need research and development, but not at the government or college lab level. We need it where it is pointed toward a useful product or service. Just funding positions so someone can publish something moves at a snails pace. We need incentives for innovation and patents in order to recover from the serious production and brain drain on the country. We have serious environmental and energy problems and these cannot be solved by government research.

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