[Senate Hearing 110-1197]
[From the U.S. Government Publishing Office]



                                                       S. Hrg. 110-1197

 
          UNITED STATES COMPETITIVENESS THROUGH BASIC RESEARCH

=======================================================================

                                HEARING

                               before the

          SUBCOMMITTEE ON SCIENCE, TECHNOLOGY, AND INNOVATION

                                 of the

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 19, 2007

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation



                  U.S. GOVERNMENT PRINTING OFFICE
78-569                    WASHINGTON : 2013
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing Office, 
http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center, U.S. Government Printing Office. Phone 202ï¿½09512ï¿½091800, or 866ï¿½09512ï¿½091800 (toll-free). E-mail, [email protected].  


       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                   DANIEL K. INOUYE, Hawaii, Chairman
JOHN D. ROCKEFELLER IV, West         TED STEVENS, Alaska, Vice Chairman
    Virginia                         JOHN McCAIN, Arizona
JOHN F. KERRY, Massachusetts         TRENT LOTT, Mississippi
BYRON L. DORGAN, North Dakota        KAY BAILEY HUTCHISON, Texas
BARBARA BOXER, California            OLYMPIA J. SNOWE, Maine
BILL NELSON, Florida                 GORDON H. SMITH, Oregon
MARIA CANTWELL, Washington           JOHN ENSIGN, Nevada
FRANK R. LAUTENBERG, New Jersey      JOHN E. SUNUNU, New Hampshire
MARK PRYOR, Arkansas                 JIM DeMINT, South Carolina
THOMAS R. CARPER, Delaware           DAVID VITTER, Louisiana
CLAIRE McCASKILL, Missouri           JOHN THUNE, South Dakota
AMY KLOBUCHAR, Minnesota
   Margaret L. Cummisky, Democratic Staff Director and Chief Counsel
Lila Harper Helms, Democratic Deputy Staff Director and Policy Director
   Christine D. Kurth, Republican Staff Director and General Counsel
Kenneth R. Nahigian, Republican Deputy Staff Director and Chief Counsel
                                 ------                                

          SUBCOMMITTEE ON SCIENCE, TECHNOLOGY, AND INNOVATION

JOHN F. KERRY, Massachusetts,        JOHN ENSIGN, Nevada, Ranking
    Chairman                         JOHN McCAIN, Arizona
JOHN D. ROCKEFELLER IV, West         KAY BAILEY HUTCHISON, Texas
    Virginia                         GORDON H. SMITH, Oregon
BYRON L. DORGAN, North Dakota        JOHN E. SUNUNU, New Hampshire
BARBARA BOXER, California            JIM DeMINT, South Carolina
MARIA CANTWELL, Washington           JOHN THUNE, South Dakota
MARK PRYOR, Arkansas
CLAIRE McCASKILL, Missouri
AMY KLOBUCHAR, Minnesota


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on April 19, 2007...................................     1
Statement of Senator Ensign......................................     3
Statement of Senator Inouye......................................     5
    Prepared statement...........................................     6
Statement of Senator Kerry.......................................     1
Statement of Senator Pryor.......................................    45
    Prepared statement...........................................    47
Statement of Senator Sununu......................................     6
Statement of Senator Thune.......................................    10

                               Witnesses

Bement, Jr., Dr. Arden L., Director, National Science Foundation.    22
    Prepared statement...........................................    23
Jeffrey, Dr. William A., Director, National Institute of 
  Standards and Technology, Technology Administration, U.S. 
  Department of Commerce.........................................    28
    Prepared statement...........................................    30
Marburger III, Dr. John, Director, Office of Science and 
  Technology Policy, Executive Office of the President...........    11
    Prepared statement...........................................    13

                                Appendix

Response to written questions submitted by Hon. Mark Pryor to:
    Dr. William A. Jeffrey.......................................    51
    Dr. John Marburger III.......................................    51
Response to written questions submitted by Hon. Kay Bailey 
  Hutchison to:
    Dr. Arden L. Bement, Jr......................................    53
    Dr. John Marburger III.......................................    52


          UNITED STATES COMPETITIVENESS THROUGH BASIC RESEARCH

                              ----------                              


                        THURSDAY, APRIL 19, 2007

                               U.S. Senate,
          Subcommittee on Science, Technology, and 
                                        Innovation,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 10:04 a.m. in 
room SR-253, Russell Senate Office Building, Hon. John F. 
Kerry, Chairman of the Subcommittee, presiding.

           OPENING STATEMENT OF HON. JOHN F. KERRY, 
                U.S. SENATOR FROM MASSACHUSETTS

    Senator Kerry. This hearing will come to order.
    Good morning, thank you, all of our witnesses, for being 
here, we appreciate it very, very much.
    Everybody here understands what our basic research and 
innovation means to our economy. Fifty percent of our economic 
growth in the last half century is due to scientific 
breakthroughs and technological innovation. And most of our 
productivity comes from it.
    Our competitors know this also, and that's why 
increasingly, in other countries, they've been dedicating more 
and more of their resources to compete with us, and some of 
them are catching up. In Europe, Japan, and China, there's a 
very specific, intensive dedication to investments in science 
and engineering.
    We're here today because we believe that America can 
improve our competitiveness posture through basic research, and 
ensuring that our students remain capable of advancing the 
fields of technology, science and engineering.
    Inexplicably, the Administration has, over the last years, 
eliminated or cut funding for some of our most successful 
programs, and I'm not sure why. They have persisted in 
attempting to cut funds for the highly successful Manufacturing 
Extension Partnership, and the Advanced Technology Program.
    Notwithstanding scores of success stories that have been 
generated from these fairly modest Federal investments. There's 
a company in Massachusetts, now the number one exporter of LCD 
displays to Japan, which used an ATP partnership to create jobs 
and growth, in fact, an ATP partnership led to the creation of 
the digital mammogram.
    In my judgment it makes no sense to cut a program that 
retains and creates high-paying, high-tech jobs, when we know 
that Asian and the European Community are implementing large-
scale, long-range, R&D projects.
    The bottom line is that a national budget ought to reflect 
your values and your priorities, but the choices in the budget 
today, many of us feel, will have a negative impact on our 
Nation's ability to innovate and compete.
    Over the past years, we have had the opportunity to sustain 
American competitiveness in the world economy in a number of 
different ways. But the investments have not supported those 
opportunities.
    I don't suggest that Government policy can or should 
single-handedly dictate events, or the course of choices in the 
marketplace. We had that debate, probably in the 1980s here 
with President Reagan, and we all concluded that we're not 
trying to pick winners, and we're not trying to create losers. 
And that's not our role.
    But, clearly the impact of Government investment has been 
proven to make a profound difference to the framework within 
which private sector choices are made. Perhaps, you know, one 
of the obvious classic examples of that is the Internet itself, 
which came out of Government research. The private sector saw 
the opportunities and took it and ran with it.
    There are many other such examples. There are also 
countless examples of mainstream consumer products that have 
come out of Government research and programs themselves, the 
Space Program is a classic example of that.
    Personally, I join with those who put their faith in the 
American entrepreneur and the American worker. But, it is clear 
that other governments are leveraging, to the greatest degree 
possible, their opportunities within the marketplace. There is 
much that we can do.
    I know that when I traveled, for instance, to Hong Kong and 
met with our foreign commercial service personnel, they were 
really frustrated at the absence of a significant Federal 
commitment to their ability to go out and compete for the RFPs 
that were being presented by countries in the region.
    And, indeed, many other countries were providing very 
significant resources, and very significant physical resources, 
to allow them to meet with different parties, and it was their 
conclusion, not mine, but their conclusion that we were losing 
billions of dollars of business as a consequence of our myopia.
    We've heard all the alarm bells sound now. Corporate 
leaders like Bill Gates have called our high schools 
``obsolete'' even when they're working perfectly. I've heard 
from executives at mid-sized manufacturing firms who say 
they've cut costs dramatically, but they still can't compete. 
There are a lot of different ingredients of that, but part of 
it is this increasing joint venturing that's taking place in a 
lot of countries in terms of basic research, science, 
technology, and even bringing products to market.
    Norm Augustine and his group from the National Academies 
say that our Nation risks falling behind, unless we make a 
comprehensive investment in our scientific eco-system.
    This Committee, along with others in the Senate, has 
responded. Chairman Inouye, and Vice Chair Stevens have worked 
with other Committees to craft comprehensive competitiveness 
legislation. Our Subcommittee Ranking Member, Senator Ensign, 
has been a leader in this effort as well. I've joined as a 
cosponsor of this bill, and we expect floor consideration soon.
    The bill calls for increased investments in basic research, 
NSF, at NIST and the Department of Energy. It also addresses 
the need for better science, technology, engineering, and 
mathematics education from kindergarten through graduate 
school, and re-commits the Government to high-risk research.
    The purpose of today's hearing is to examine the budgets 
and programs of our Federal science agencies. Before us are the 
Nation's preeminent science and technology agencies, and we 
welcome you here. You have broad expertise, and your programs, 
from nanotechnology and information technology to climate 
change and high-tech, provide important opportunities for 
strengthening the American economy.
    Speaking of climate change, the world is finally awakening 
to the grave threat that climate change poses. When major 
corporations from IBM to General Electric, Bruce Petroleum, 3M, 
DuPont, Dow Chemical and others are all calling for a 
Government response to the need to price carbon, and to begin 
to move in that direction with greater technology, it's 
significant.
    Rather than sit idly by, as I'm afraid the Administration 
has done for almost 7 years, other nations have taken 
significant action, and are reducing their fossil fuel 
consumption and carbon dioxide emissions. We need to challenge 
ourselves to do what is important to our own economic future, 
as well as our health, safety, and security.
    There's an enormous economic opportunity staring us in the 
face, and others are more aggressively pursuing that than we 
are. Witness what happened with photovoltaic alternative 
renewables, and the loss of our lead to Japan and Germany, 
because we basically refused to fuel the research that we 
committed to in the late 1970s.
    Companies that provide greener products, you can see it in 
General Electric's ecoimagination advertising, you can see it 
in their revenues, with more efficient batteries, cleaner 
engines, more efficient appliances, and electronics that 
consume less, these are going to be the companies that prosper.
    Our challenge is to fund research and development that can 
enable a green product revolution and to educate the students 
who can invent, manufacture, and service these products.
    So, we look forward to hearing from our distinguished 
panel, Dr. Marburger, the Director of the Office of Science and 
Technology, thank you for being here, doctor, and Dr. Arden 
Bement, Director of the National Science Foundation, and Dr. 
Bill Jeffrey, National Institute of Standards and Technology.
    Senator Ensign?

                STATEMENT OF HON. JOHN ENSIGN, 
                    U.S. SENATOR FROM NEVADA

    Senator Ensign. Thank you, Mr. Chairman, for holding this 
important hearing. I'm very excited that our competitiveness 
bill will be on the floor, very soon. Although we cannot 
predict the exact timing, whether it will be later today, 
tonight, or early next week sometime, the bottom line is that 
the full Senate will consider and hopefully pass our 
competitiveness bill very soon.
    A lot of work went into that bill last year. I appreciate 
Senator Inouye working with Senator Stevens on this Committee, 
as well as the leaders of the HELP Committee, and the Energy 
Committees, all working together on this bill. This bill is 
really one of the more remarkable work products that has come 
out in a bipartisan fashion in a long time.
    I was put in charge by Senator Frist last year, of trying 
to bring all of those groups together, and trying to just bring 
three Committees--forget Republicans and Democrats--trying to 
bring three Committees together to work on the same product and 
actually come up with something that all three of the Committee 
chairmen and ranking members would cosponsor, as well as both 
of the leaders, and then to bring virtually the same product 
back in this Congress, have both of our leaders cosponsor the 
bill and bring it directly to the floor so we didn't have to go 
through more machinations this year, it's very exciting. A big 
part of the bill is what we are here to discuss today, and that 
is addressing the basic research needs that we have in the 
United States.
    Anybody who looks at my record knows that I'm one of the 
most fiscally conservative people in the United States Senate. 
But there are places where the Federal Government can actually 
invest strategically, to where you get huge returns in tax 
revenues in the future, and also huge economic returns. And, 
there's no better place to look at that, than in high-risk, 
basic research.
    Since the mid-1990s, we have dramatically increased the 
funding levels in the life sciences, but we have not kept up 
those increases in funding levels in the physical sciences. 
That is really a lot of what today's hearing is about, hearing 
from all of you folks and getting direct testimony on this 
issue.
    Now, we have to make sure that when we're doing this that 
we are always using taxpayer dollars, in the way that maximizes 
the benefit. I don't care how much you increase science budgets 
by, if you don't use the dollars correctly, you will not get 
the appropriate bang for the buck. So we want to make sure that 
as we're going through this process that we are investing in 
those types of research grants that have the potential to yield 
the most results in the long term. Of course, with any basic 
research, you never know what's going to be the end result of 
the research, but you want to have the processes properly set 
up and in place. I know that a lot of that has been done in the 
past, but we want to continue to streamline it, and improve it 
in ways where we invest in the types of research that have the 
potential to yield the most results.
    So, I'm excited about this whole process. Basic research is 
about keeping America competitive in the world. Basic research 
produces large amounts of jobs, as we go forward and then let 
the companies conduct the applied research, and bring exciting 
products to the market. We're not saying that we know which one 
of the basic research projects that are being funded today is 
going to be the next disruptive technology of the future that 
is going to totally revolutionize the economy.
    We just have no idea what specifically will emerge ``out of 
basic'' research conducted today. But companies in the private 
sector cannot afford to fund that kind of basic research, 
really, only the Government can. So, I'm excited about today's 
hearing, and working on this project, and seeing how we can 
keep America competitive in the 21st century.
    And a big part of this--as you've mentioned, Mr. Chairman--
is education. You know, it's great to have the research, but if 
we're not, educating the next generation of engineers, if we're 
not inspiring young people then we will be in trouble. We have 
the finest colleges and universities in the world. People from 
all over the world have wanted to come here. Now, that is 
changing. Other countries are catching up to us even in the 
university setting, but we still--at this point in time--have 
the finest universities in the world.
    Unfortunately, in Kindergarten through 12th grade, we do 
not have the best system for teaching the STEM fields. We're 
not inspiring our young people to love math and science, and 
we're not doing a good job of teaching. We've done hearings in 
the HELP Committee and in this Committee, on some of the things 
that we're not doing right. We really need to figure out how to 
improve our STEM education for the future of our American 
workforce and so that we have those kinds of people that create 
the jobs for everybody else.
    One of the statistics that several experts mention is that 
4 percent of the population is going to create the other 96 
percent of jobs. A lot of the jobs in both categories are in 
the science, technology, engineering and mathematics fields, 
and so we have to make sure that we are providing the kind of 
educational opportunities, that we need to enable American 
students to succeed. I agree with Bill Gates, we have to 
dramatically re-think what we are doing in Kindergarten through 
12th grade to get our children on the right paths toward a 
bright educational future.
    So, thanks again, Mr. Chairman, for holding this hearing 
today.
    Senator Kerry. Thank you very much, Senator Ensign. Thank 
you for your leadership, again, as I said, I know you've been 
involved, and it's been fun working with you on a lot of this 
stuff.
    We're pleased to have the Chairman of the full Committee 
here, who has helped lead us to get that bill ready to be on 
the floor, and Senator Inouye, thank you for that.

              STATEMENT OF HON. DANIEL K. INOUYE, 
                    U.S. SENATOR FROM HAWAII

    The Chairman. I thank you very much, I wanted to be here, 
Mr. Chairman, to demonstrate my support for the work being 
conducted by this Subcommittee.
    A few weeks ago I read an article that was a bit 
frightening. It indicated that one-third of fourth graders in 
the United States performed at or above a level deemed 
proficient, and about a fifth of eighth graders lacked the 
competency to perform basic mathematic computations. In this 
country, only 32 percent of Americans graduate with college 
degrees in science and engineering, and at the same period, in 
China, the Chinese graduated more than 600,000 engineers, 
India, 350,000, and we had less than 70,000.
    I think something must be done to change these trends, and 
I'm here to give my support, sir.
    Thank you very much. May I have the rest of my statement 
included?
    [The prepared statement of Senator Inouye follows:]

 Prepared Statement of Hon. Daniel K. Inouye, U.S. Senator from Hawaii

    Our economy's strength derives from our competitiveness as a nation 
in the fields of emerging technologies. The genius and painstaking work 
of our scientists, and the hard-won government funding for research and 
development, are investments that have paid dividends not only in world 
class peer-reviewed scientific papers but also in cutting edge 
technologies that keep America competitive in the global marketplace.
    America's young people are surrounded by an array of these 
sophisticated technologies. They use these complex gadgets with ease 
and confidence for both study and play. Unfortunately, we have heard 
the warnings from Norm Augustine and his National Academy of Sciences 
panel in Rising Above the Gathering Storm that our technologically 
sophisticated youth are slipping behind their international competitors 
when it comes to discovering and building the next generation of 
products.
    Although it seems that every month there is a new ``best'' cell 
phone or MP3 player that every teenager wants, how many of those 
teenagers actually understand the science behind wireless 
communications technology, or what it takes to develop the applications 
and operating systems that actually make the phone, and the network, 
for that matter, operational?
    This pattern is far more pervasive than simply cell phones and 
teenagers. Less than one-third of U.S. fourth graders performed at or 
above a level deemed ``proficient'' and about one-fifth of eighth 
graders lacked the competency to perform basic math computations. In 
the United States, only 32 percent graduate with college degrees in 
science and engineering.
    In 2004, while China graduated more than 600,000 engineers and 
India graduated 350,000 engineers; the United States graduated less 
than 70,000 engineers.
    We must take action today to turn these trends around if we are to 
stay competitive tomorrow.
    As the researchers of today retire, and reports to Congress 
indicate that they will be retiring in large numbers during the next 
few years; there must be a next generation to take their places. That 
means we need to educate our children so they can do more than talk 
about the science. They need to be able to do the science.
    Further, scientists, like any other member of our workforce, go to 
where the jobs are. That means we need to have the world-class 
laboratories and facilities necessary to tackle a new generation of 
questions and challenges, and those laboratories and facilities need to 
be here in America.
    These two key issues formed the backbone of this Committee's work 
on comprehensive competitiveness legislation, S. 761, the America 
COMPETES Act, and will be the lens through which we view the Fiscal 
Year 2008 U.S. research and development budget. I look forward to 
working with you in the year ahead as we make these issues our top 
priority.

    Senator Kerry. Without objection, absolutely. The Chairman 
can have whatever the Chairman wants.
    [Laughter.]
    Senator Kerry. Thank you, Mr. Chairman, we appreciate your 
taking the time to come here and share that with us.
    Senator Sununu?

               STATEMENT OF HON. JOHN E. SUNUNU, 
                U.S. SENATOR FROM NEW HAMPSHIRE

    Senator Sununu. Thank you very much, Mr. Chairman. And let 
me begin by saying that it really is important to be having 
this hearing and this discussion. We had at least one similar 
hearing last year--the more, the better--because of the 
importance of basic mathematics and science to our economy on 
the broadest scale. And I think you described that quite 
accurately in your opening comments.
    Second, let me underscore that I appreciate the amount of 
time and effort spent in developing the competitiveness 
legislation that is scheduled to be introduced in the Senate, 
in the coming weeks. I know there was a very sincere effort to 
make that bill comprehensive, to try to address a number of 
recommendations that have been put forward by the 
Administration, by independent groups, and by Members of 
Congress as well--we all have our priorities.
    And, I'll begin by talking about the most important goals 
of that legislation, which I strongly support, and have 
supported for some time, and spoken about as far back as 5 or 8 
years ago, when I was a member of the House of Representatives. 
That is, first and foremost, doubling the amount of money 
committed to the National Science Foundation for peer-reviewed 
research. It is the best, strongest, most effective vehicle we 
have for advancing basic science, in the United States and 
around the world. High-risk basic research has very long time 
horizons for payback, and the benefits are very widely 
distributed, and they are not areas that capital markets, or 
venture capitalists or others in the private sector can really 
accurately forecast. And that's why the Government has a 
responsibility in this area.
    Second, increasing the Office of Science within the 
Department of Energy which is also involved in this basic 
research, from $3.6 billion to over $5 billion in the coming 5 
years.
    Third, increasing our commitment to the National 
Laboratories, that are, really, the crown jewels in terms of 
the physical infrastructure necessary to do this important 
research. Those are critical, essential goals, extremely 
valuable achievements that are set out in the competitiveness 
legislation.
    However--and there is a very, very important ``however'' 
here--I'm very concerned that--because there were so many hands 
in it, perhaps, because there are competing interests, because 
there were four or five Committees in the Senate alone, with 
jurisdiction--its effectiveness will be diluted. We've seen a 
proliferation of programs and ideas in there that I am 
principally concerned will take away from the focused mission 
in each of these three areas: Office of Science, National 
Science Foundation, National Laboratories. Instead of 
maximizing the funding available for peer-reviewed research in 
physics and chemistry and material science and computational 
mathematics, this legislation would begin the process of 
carving out specific fiefdoms for programmatic funding.
    And whether it's for education and human resources, or for 
behavioral sciences--anything that is not geared directly 
toward that mission of peer-reviewed science, carries the risk 
of diluting the power and the importance of these institutions, 
for these important goals we share.
    I'm extremely concerned about that, these institutions can 
provide great axis for educational programs, especially for 
college and graduate level work in the math and science fields, 
but their focus needs to remain on the peer-reviewed work. And, 
I'm very much inclined to try to offer some amendments to make 
sure we get back to that focus and that emphasis.
    Second, as Senator Kerry mentioned, we shouldn't be picking 
winners and losers in private markets where there are 
commercial operations and commercial players. And, I suppose 
there's an honest disagreement, what constitutes picking 
winners and losers, but I will pick up on the example Senator 
Kerry gave, and this is an area of disagreement, and I don't 
want to get bogged down here, I just want to present a slightly 
different viewpoint on the Advanced Technology Program.
    You mentioned an example of an LCD manufacturer, it's a 
great industry, I'm sure it's a terrific company. But, they are 
manufacturing commercial products for sale in the United States 
and around the world, and any time that we provide a grant to a 
company manufacturing products for commercial sale, we are 
picking winners and losers, because that means there are some 
companies manufacturing similar, or even the same products for 
commercial sale that won't get the grant.
    And, at the same time, I recognize the Federal Government 
does a lot of this. But we need to be very concerned anywhere 
there are direct grants or subsidies going to people engaged in 
competitive commercial activity. And that, to me, is picking 
winners and losers. And, we need to do everything possible to 
minimize or avoid that kind of intervention in competitive 
markets--again, anywhere we're doing work--but in this 
legislation, in particular, there are some programs created in 
the competitiveness bill, recreated, that would do just that.
    And, again, any time we are doing that--intervening in 
commercial markets--we're diluting resources, and limiting 
resources that could go to physics and chemistry, computational 
mathematics and material science--basic peer-reviewed 
scientific research.
    Third, is this issue of education--trying to encourage our 
educational systems to produce more students interested in 
science and mathematics and engineering. I don't know if it's a 
good thing or a bad thing that I speak from some experience, 
because I'm the only member of the U.S. Senate with a 
Bachelor's Degree in Engineering. But, maybe that makes me 
biased, maybe that makes me more knowledgeable, I don't know 
the answer to that question.
    But it is my personal experience that individuals, men and 
women, pursue education in engineering at college because they 
are, they find that they are interested in math and science in 
high school. And that interest in math and science that comes 
to fruition in high school, or really begins--I shouldn't say 
comes to fruition, but is inspired in high school--doesn't even 
begin in high school, it really begins in 5th, 6th, 7th, and 
8th grade. That's where a young girl or a young boy realizes, 
``This is interesting, this is exciting. I enjoy math and 
science, I'm good at it, and when I get to high school I'll 
look forward to taking math and science classes.'' And, if it 
doesn't happen in 6th or 7th or 8th grade, it's not going to 
happen when they're a junior or senior in high school.
    So, if you really want to do something about creating 
engineers, you don't create programs necessarily for post-
graduate students in material science--that doesn't encourage 
more engineers. It might be an important program for a post-
graduate electrical engineering student, but if you want to get 
more post-graduate electrical engineering students, you need to 
get more electrical engineering undergraduates. And if you want 
more electrical engineering undergraduate students, you need to 
get them interested in math and science in 6th and 7th and 8th 
grade.
    So, a huge burden here has to be on our K through 12 
system. And whether it's inspiration through the Department of 
Education in math and science in K through 12, or the corporate 
leaders that come to Washington that complain that we don't 
have enough math and science students getting more involved at 
the local level, to inspire math and science focused 
curriculum--those are all good ideas, and those ought to be 
pursued. But, we need to recognize that the inspiration process 
occurs much earlier.
    Senator Inouye had it exactly right--the scary statistics 
are the proficiency in 4th grade, and proficiency in 8th grade. 
And if only a third are proficient in 4th or only half are 
proficient in 8th, you're going to get fewer math and science 
students in high school, in college. That's just a basic fact. 
So, for in terms of inspiration, and encouraging more to pursue 
this field, we have to deal with those numbers that Senator 
Inouye talked about.
    I think we need to remain focused on the basics, we need to 
act as aggressive as possible at pursuing these goals for 
doubling NSF funding, Office of Science funding, and National 
Laboratory funding, and we need to remain true to our mission.
    One final thought about the educational effort. The 
Academic Competitiveness Council put out its initial findings 
in March. They looked at all of our science, technology, 
engineering and math education programs in the Federal 
Government. And, on the one hand, I think we can say we're 
pleased to find there are lots of them. On the other hand, 
they're not necessarily--as the Council found--as focused as 
they should be, there are duplication and overlaps, there is 
not necessarily the follow-through that there should be.
    A dozen in the Department of Agriculture, seven in the 
Department of Commerce, eight in the Department of Defense, 12 
in Education, 34 in the National Science Foundation, six in the 
Department of Transportation, five in the Department of Health 
and Human Services and so on--all of these programs focused on 
science, technology, engineering, and mathematics. And what I 
don't think we've done in the competitiveness bill is look at 
these programs, and find out ways to strengthen them and 
improve them, and make sure they're focused on the goals that 
we do share, that absolutely come to us across party lines.
    So, I hope that we'll do more to look at how those programs 
are implemented. If we look at the programs in the target areas 
that they have, of that list of programs, 57 of them focus on 
under-represented populations, 39 focus on teachers, 60 focus 
on practitioners, 61 on undergraduate students who are majors, 
21 on undergraduate students who are non-majors, 51 on graduate 
studies. So we can see that there is a lot of duplication, and 
that's not necessarily a bad thing, but we want to make sure 
that their efforts are as complementary as possible, where we 
have multiple programs.
    I know that's a tall order, you've been very generous with 
the time, Mr. Chairman, I just think it's important that we 
emphasize, even as we pursue the right goals, and the right 
levels of funding, we want to make sure that we stay as focused 
as possible. No legislation is perfect, and even when, where we 
have legislation, we're going to have some disagreement on what 
you might put in the bill and what I might put in the bill, but 
I think there's so much agreement here, and so much consensus 
about the importance of this issue, we ought to be able to 
improve it before it finally goes to the President.
    Thank you very much, you were very, very generous with the 
time, and I appreciate that.
    Senator Kerry. Thank you, Senator Sununu. We do want to get 
to our witnesses, I want to just make one comment on the ATP, 
but Senator Thune, do you want to make any comment, or are 
you--?

                 STATEMENT OF HON. JOHN THUNE, 
                 U.S. SENATOR FROM SOUTH DAKOTA

    Senator Thune. Mr. Chairman, I thank you for holding this 
hearing. I think this is an important subject, and it's 
obviously a tough issue for us to get our arms around because 
there isn't a single policy that's going to keep us 
competitive. As the world leader in science, innovation, and 
entrepreneurship, I think we have to be continually focusing on 
fostering math, science, and basic research at our schools and 
universities in order to stay on top, and we also have to 
ensure that we've got good tax rates, regulatory regimes, and 
legal environments that aren't so onerous that we lose 
businesses and jobs to other countries.
    We aren't creating our policy in a vacuum, and if we don't 
get it right, some other country will, and we will lose 
businesses and jobs to that country.
    Again, I appreciate you holding this hearing, I think this 
is an important subject, I look forward to hearing from our 
witnesses and I have a couple of questions when that time 
comes.
    Thank you, Mr. Chairman.
    Senator Kerry. Great.
    Well, we're going to go fairly rapidly to--I do want to 
just comment on one thing if I can on the ATP, and I don't want 
to engage in a long, drawn-out debate.
    When I was Lieutenant Governor of Massachusetts, I sat ex 
officio on a board called the Mass Technology Development 
Corporation, and we were specifically charged with allocating 
certain funding to venture startup efforts using state money 
for projects that simply couldn't get funded in the private 
sector--they were very high-risk, they were very long-distant 
future for returns, but it was a promising field.
    And our charge was, specifically, to sort of make a 
selection between those kinds of projects, which we did, and 
the minute--if they were successful, that they showed that 
success, an ability to stand on their own, we withdrew. The 
Government got out of it, and the normal capital market process 
would take over.
    I'm pleased to say that there are a number of companies 
today on the big board that have provided enormous job base and 
significant revenues to our state that would otherwise not have 
been funded if we hadn't done that. And, I think we did it with 
a sensitivity to this notion of not picking, you know, specific 
winner or loser, but taking a project in a sector that couldn't 
get funded.
    Now, ATP has had the very, very similar kind of charge 
here. It fills a national need, broad-based innovation 
requirements for the Nation. And, sure an ATP participant 
benefits from this. But, they put up the majority of the 
funding. And, they're taking huge risk, which otherwise the 
private sector won't fund.
    Now, it's good and well to sit here and say, ``Well, the 
private marketplace ought to do this,'' but they don't. 
Everybody knows it. There's only so much private capital, 
there's a capital pool that goes out there, there's a certain 
risk they're willing to take. The fact is that we have repaid, 
in the tax base of our country, more times over, many times, 
what we've put up.
    So, if you want to talk about return on investment, and 
smart leverage, this has been about as smart a leverage program 
as there is. And the ATP selection criteria require that the 
potential benefits of projects be broad-reaching, not narrow, 
incremental improvements, but broad-reaching improvements that 
spill out into the rest of the economy. And significantly, it's 
been extensively reviewed since its inception.
    There have been more--there have been the General 
Accounting Office has conducted 14 studies, 10 studies have 
been completed by the Department of Commerce's Inspector 
General former Secretary of Commerce Bill Daly sponsored a 60-
day study, the National Academy of Science's National Research 
Council published ATP Challenges and Opportunities in 1999, and 
ATP Assessing Outcomes, in 2001.
    In addition, 25 studies have been conducted by ATP's 
Economic Assessments Office and they have all--all--revealed 
that the ATP does not, does not fund projects that otherwise 
would have been financed in the private sector. Rather, the ATP 
have funded the so-called Valley of Death projects, those that 
just couldn't find the financing otherwise.
    And in June of 2001, the National Academy of Science, 
National Research Council completed its comprehensive review, 
and they found that it's an effective Federal partnership, 
funding new technologies that contribute to important societal 
goals.
    I could go on and on and on--I'm not going to now, but I 
really think that given that kind of a record, and we can get 
into this a little bit, it's hard to understand why somebody 
would zero-fund it. Measured against the unbelievable successes 
that we've had.
    So, you know, it's worthy of a debate--all of these things 
are worthy of debate, but the facts are facts, and the record 
is the record, and it's pretty darn hard to ignore, sort of, 
the sensitivity with which it's been constructed, the 
requirements are very rigorous for who can participate and how, 
and what the benefits have been.
    I know we wanted to try to get here, Senator Pryor, did you 
want to make any quick comment, because we do want to try to, 
you know, thanks, very much.
    Dr. Marburger, if you'd lead off, we'd appreciate it very 
much.
    And your full testimonies can be placed in the record, if 
you want to summarize, we can get to have a good dialogue here, 
and that'd be helpful.

         STATEMENT OF DR. JOHN MARBURGER III, DIRECTOR,

            OFFICE OF SCIENCE AND TECHNOLOGY POLICY,

               EXECUTIVE OFFICE OF THE PRESIDENT

    Dr. Marburger. Thank you, I will do that.
    And thank you very much, Chairman Kerry, and Ranking Member 
Ensign, members of the Subcommittee for inviting me to present 
the President's Fiscal Year 2008 research and development 
budget.
    And I also want to thank the Committee on behalf of the 
Administration for the good working relationship that it has 
established with the science agencies, and with my office. And 
I look forward to working together on the important task of 
fostering innovation and competitiveness. We agree on the 
thrust of the principles, I believe.
    As you know, President Bush has proposed a Federal budget 
that will balance in 5 years. By continuing strong pro-growth 
economic policies, and by holding non-security discretionary 
spending below inflation. And that requires establishing 
priorities, and allocating resources to achieve the greatest 
impact.
    Winning the war on terror, securing the homeland, 
strengthening the economy remain the President's top 
priorities, and this year's budget, once again, proposes 
investments in America's future competitiveness through 
research and development.
    The President is proposing a $142.7 billion Federal R&D 
budget, that's another record-breaking budget, an increase of 
$5.5 billion over his 2007 proposal. And within this record-
breaking top line amount, are increases in categories of 
funding that are important for broad national goals, including 
innovation and competitiveness.
    In this budget, non-defense research increases at a higher 
rate than the rest of the discretionary budget, expanding once 
again, this year, the science share of available funds to 13.9 
percent, it's unprecedented.
    Growth in non-defense R&D, important for civilian 
productivity, during this Administration has been substantial, 
and there's a chart in my written testimony in the record.
    The basic research category, which includes Department of 
Defense 61 funds, also grows in this budget, by nearly a 
billion dollars, from $27.5 billion to $28.4 billion. The 
indicator called Federal Science and Technology, which includes 
DOD 61 and 62 funds, increases by $1.5 billion, relative to the 
President's 2007 proposal.
    Many of these increases come from follow-through on the 
President's American Competitiveness Initiative last year, and 
further commitments to R&D this year to diversify America's 
energy supply.
    The ACI does set education as well as research priorities, 
and it focuses funds accordingly. The overarching research 
priority in the ACI is innovation-enabling basic research in 
physical science and engineering. Multi-year funding targets 
are set for NSF, NIST research, and DOE's Office of Science, 
which has been mentioned here. The Fiscal Year 2008 budget 
calls for a 7.2 percent increase for these agencies, on top of 
the 9.3 percent increase the President requested in Fiscal Year 
2007. This additional $764 million would bring the two-year ACI 
research incremental investment to $2.6 billion.
    Unfortunately, the Fiscal Year 2007 Continuing Resolution 
process only provided half of the first year ACI budget 
increase requested, $452 million short of the President's 
request. And, I do hope we can catch up this year.
    This program responds to a very strong call from the 
Nation's high-tech community, as you've noted, Mr. Chairman 
whose recent American Innovation Proclamation--a very nice 
summary, I would say of our mutual goals--summarizes exactly 
the principles of the President's initiative. The Proclamation 
has been endorsed by hundreds of American business and higher 
education leaders, and it preserves the focus and the 
priorities that are so important to the American 
Competitiveness Initiative.
    This budget contains substantial investments in research 
and other important areas that are described in more detail in 
my written testimony. It sustains budgets for climate change 
and science and technology, it includes funding to improve 
Earth observations capabilities in areas such as ocean 
observing, earthquake monitoring and prediction, tsunami 
warnings. It provides funds for the Landsat Data Continuity 
mission, the Global Precipitation Measurement Mission, launches 
a new Ocean Initiative, with over $80 million.
    The Advanced Energy Initiative in this budget, that, 
Department of Energy is increased by 26 percent, to $2.7 
billion, accelerating clean electricity generation 
technologies. This year the AEI includes over $700 million in 
basic research at DOE's Office of Science, a 32 percent 
increase, to overcome major technical barriers, the use of 
solar, biomass, hydrogen and fusion.
    We have other initiatives--the National Nanotechnology 
Initiative continues to grow, biomedical research would receive 
$431 million in new funds over the 2007 request, and so forth.
    Let me just finish this rapid and incomplete overview by 
expressing a concern about NASA, and the budget danger that 
lies ahead for this agency.
    The President's Fiscal Year 2008 budget includes a 3.1 
percent increase for NASA in 2008, on top of the 3.4 percent 
the President requested for 2007. But, unfortunately, once 
again, the CR held NASA more than a half a billion dollars 
below the President's request, which causes great stress on 
that agency, and we're concerned about that.
    Mr. Chairman, I believe that this year's R&D budget 
proposal does provide robust levels of investment that will 
allow America to maintain its leadership position in science, 
and move ahead in selected priority areas.
    I'd like to thank you for the opportunity to address the 
Committee on these points.
    [The prepared statement of Dr. Marburger follows:]

   Prepared Statement of Dr. John Marburger III, Director, Office of 
    Science and Technology Policy, Executive Office of the President

    Chairman Kerry, Ranking Member Ensign, and Members of the 
Subcommittee, I am pleased to appear before you today to present the 
President's Fiscal Year 2008 research and development (R&D) budget. 
Although this is my first appearance before the Committee under the new 
Congressional leadership, I am aware that this Committee has expressed 
bipartisan support for science funding in the past, and values 
scientific research and its applications for the benefits it brings to 
every part of our society. On behalf of the Administration, I thank the 
Committee for the good working relationship it has established with the 
science agencies and with my office, and look forward to working 
together in the future to advance American innovation and 
competitiveness.
    This year, President Bush presents a Federal Budget that will 
balance in 5 years. The President proposes to do this by continuing 
strong pro-growth economic policies and by holding non-security 
discretionary spending below inflation. This strategy inevitably 
requires establishing priorities and allocating resources to achieve 
the greatest impact. Winning the war on terror, securing the homeland 
and strengthening the economy remain the President's top priorities, 
and this year's budget once again emphasizes investments in America's 
future competitiveness through research and development. The President 
is proposing a record $142.7 billion 2008 Federal R&D Budget, an 
increase of $5.5 billion over his 2007 Budget. And the American 
Association for the Advancement of Science (AAAS) estimates that 2008 
non-defense Federal R&D is increased by over 2.1 percent in the 
President's Budget, much better than overall non-defense discretionary 
spending. The President's commitment to the government's R&D enterprise 
is strong, and the advancement of science remains among his top budget 
priorities.
    While significant increases have occurred for defense-related 
development--most of the ``D'' in R&D--it is important to be aware of 
the very significant growth during this Administration in non-defense 
research spending, as shown in the accompanying chart.



    Non-defense R&D has continued on a significantly upward trajectory. 
In fact, with President Bush's 2008 Budget, real growth in outlays for 
the conduct of non-defense R&D--i.e. corrected for inflation--is up 
26.5 percent during the 7-years of this Administration.
    The 2008 Budget also raises funding for the category of Basic 
Research almost $1 billion above the most currently calculated level of 
2006: $28.4 billion compared to $27.5 billion. This is a direct 
indication of the Administration's strong focus on fundamental research 
and the discovery of new knowledge as a leading mission of the Federal 
Government. It is notable that this favorable treatment of Basic 
Research is occurring in a year of belt-tightening for many other 
domestic programs, indicating the high priority this Administration 
places on the importance of this activity.
    Basic Research, by itself, however, is not the complete measure of 
investment activities that drive future innovation. The accounting 
category known as the Federal Science and Technology Budget emphasizes 
both basic and applied science and engineering research short of 
development, and thus captures other important activities underpinning 
competitiveness. The Federal S&T Budget advances $1.3 billion in 2008 
relative to 2006 funding levels, and when only civilian S&T agencies 
are considered, it represents a 4 percent increase. If Congress fully 
supports the President's 2008 request, Federal science and technology 
investment will increase $1.5 billion from the President's own 2007 
Budget.
    These very positive historical trends directly reflect the launch 
of the American Competitiveness Initiative (ACI) last year and further 
commitment to the importance of research and development to diversify 
America's energy supply in this year's State of the Union address. This 
focus on research and development, science and math education, and 
advanced energy solutions directly supports our National goals of 
protecting the homeland, educating our children and making the economy 
strong.
    The American Competitiveness Initiative establishes clear research 
and education priorities and focuses increased funding accordingly. The 
overarching ACI research priority is innovation-enabling physical 
science and engineering research. As the next chart illustrates, ACI 
funding increases under this priority are targeted to three science 
agencies, including two under the jurisdiction of this Subcommittee--
the National Science Foundation and the laboratories of the National 
Institute of Standards and Technology--as well as DOE's Office of 
Science. The 2008 Budget calls for a 7.2 percent increase on top of 
2007's 9.3 percent requested increase. This additional $764 million 
brings the total two-year ACI Research incremental investment to $2.6 
billion. I want to note that the recently released ``American 
Innovation Proclamation--a package of consensus recommendations by 
American business and higher education leaders--calls for the doubling 
of the ACI research agencies.



    Unfortunately, the 2007 Continuing Resolution only provided 50 
percent of the first-year ACI budget increase. That was $452 million 
short of the increase in the President's request. I know this Committee 
is as disappointed as I am at this shortfall for science. This is not 
sufficient to meet America's competitiveness challenge, and falls short 
of the aforementioned doubling path that is the key component of the 
Initiative. A year of enhanced and expanded high-impact innovation 
research is diminished and a $1.2 billion increase is now required in 
2008 to ``catch up'' to the President's commitment. Achieving this in 
2008 is critical to sustaining momentum necessary to complete the 
doubling Initiative in the outyears.
    Before turning to other specifics of this year's research budget, I 
want to comment on S. 761, the America COMPETES Act, which I understand 
Senate leadership may be considering for floor time. While I commend 
this Committee and the entire Senate for its leadership and efforts on 
the issue of competitiveness, I must share with you concerns I have 
regarding the specific provisions of this legislation. These concerns, 
which I raised in a letter (appended) to the Committee when nearly 
identical legislation was considered last year, largely center on the 
many new programs created in the bill, and how their focus and cost 
would divert resources available for priority basic research in the 
physical sciences at the key ACI agencies (for example, the 
Administration estimates the legislation creates up to 20 new programs 
and could cost over $8.6 billion more than projected Administration 
budgets over 4 years). I hope the Senate will give strong consideration 
to these concerns, in Committee or otherwise, before it commits to 
floor consideration of any competitiveness-related legislation. I 
believe we share a common interest in working to strengthen America's 
capacity to innovate and retain its leadership position in the global 
economy, and I look forward to working with you toward this goal.
    Another major concern I must address is the serious, deleterious 
impacts of earmarking on the Federal science budget in the past. 
Earmarks circumvent the scientific merit-review process for identifying 
and funding the best research. That process has been the bedrock of our 
Nation's scientific leadership. On January 3, 2007, President Bush 
called on Congress to cut the number and cost of earmarks by at least 
half this year. To help establish a clear and transparent benchmark for 
accurately measuring the President's goal, OMB developed a database on 
FY 2005 earmarks. As we discuss the importance of pursuing the best 
science to contribute to U.S. competitiveness, I hope the new Congress 
will reject research earmarks in FY 2008, as it so commendably did in a 
spirit of reform in the Continuing Resolution for the current Fiscal 
Year. We would like to work with the new Congress to achieve the 
President's goal.
    While future competitiveness is a national priority that is 
reflected in the Federal R&D budget request, there are additional 
national goals that are similarly well-served by the FY 2008 Budget. 
Since 2002, the Administration has spent approximately $9 billion on 
climate change science research through the multi-agency Climate Change 
Science Program (CCSP), and the President's 2008 Budget sustains that 
level of effort. I should note, however, that some of the research 
projects included in earlier CCSP totals have now advanced to 
operational missions which are no longer included in CCSP totals, but 
which certainly contribute significantly to advancing climate science 
research. Further, between 2003 and 2006, the President has committed 
nearly $3 billion annually to the climate change technology research 
and deployment programs that constitute the multi-agency Climate 
Technology Program. The U.S. leads the world in advancing climate 
science and technology, with expenditures on the order of $35 billion 
in climate-related science, technology, international assistance, and 
incentive programs during this Administration.
    Undoubtedly, previous investments in advanced energy science and 
technology have put the U.S. well on track to meet the President's goal 
of reducing greenhouse gas intensity 18 percent by 2012. In addition, 
the 2008 Budget includes funding to improve our Earth Observations 
capabilities in areas such as ocean observing, earthquake monitoring 
and prediction, and tsunami warnings. The Budget request also provides 
funding to continue the Landsat Data Continuity Mission, to move 
forward with the Global Precipitation Measurement mission, and to 
launch a new Ocean Initiative with over $80 million in new funding for 
ocean science research at the National Oceanic and Atmospheric 
Administration, NSF and the U.S. Geological Survey. This Ocean 
Initiative is based on priorities set forth in the Ocean Research 
Priorities Plan: Charting the Course for Ocean Science in the United 
States, a report of the National Science and Technology Council's Joint 
Subcommittee on Ocean Science and Technology, written with significant 
input from the external scientific and resource management communities.
    Biomedical research is supported in the 2008 NIH Budget with an 
increase of $431 million over the 2007 request. The FY 2008 request of 
$28.7 billion will allow NIH to maintain many priorities including 
awarding over 9,400 new and competing research grants. The NIH 
Director's Roadmap Initiative is increased in 2008 to enhance this 
interdisciplinary incubator for new ideas that will accelerate the pace 
of discovery across the NIH's 27 Institutes and Centers.
    The Advanced Energy Initiative (AEI) at DOE is funded at $2.7 
billion in the 2008 Budget, which is a 26 percent increase over the 
President's 2007 request and almost $1 billion more than 2006. The AEI 
will develop technologies that could help contribute to the President's 
goal of cutting gasoline use by 20 percent in 10 years through 
legislative and regulatory actions. AEI will help by accelerating the 
technical and cost viability of plug-in hybrids, hydrogen-powered fuel 
cells, and ``cellulosic'' ethanol derived from biomass, which are all 
technologies that could help meet the President's twenty in ten goal. 
AEI will also accelerate clean electricity generation technologies such 
as solar, wind, nuclear, and clean coal. Perhaps most critically, the 
2008 AEI includes over $700 million in basic research at DOE's Office 
of Science, a 32 percent increase, to overcome major technical barriers 
to the use of solar, biomass, hydrogen and fusion. With the 2008 
Budget, the Presidential commitment to invest $2 billion on clean coal 
research is fulfilled, as is President Bush's commitment to propose a 
five-year, $1.2 billion Hydrogen Fuel Initiative.
    This Administration's National Nanotechnology Initiative also 
strongly continues with $1.45 billion in 2008 for this multi-agency, 
highly-coordinated investment in fundamental research, multi-
disciplinary centers of excellence, and development of focused cutting-
edge research and education infrastructure. The NNI also supports 
activities addressing the societal implications of nanotechnology, 
including those related to human and environmental health and methods 
for managing potential risks. With the 2008 request, over $8 billion 
will have been spent on nanoscale R&D in 7 years.
    Finally, let me finish by expressing a concern regarding NASA and 
the budget danger that lies ahead for this agency. The President's FY 
2008 Budget includes a 3.1 percent increase for NASA in 2008 on top of 
the President's 3.4 percent requested increase for 2007. However, the 
FY 2007 CR held NASA $545 million below the President's request. That 
leaves NASA at its 2006 level (hurricane supplementals removed) with no 
increase and puts at risk the Vision for Space Exploration and priority 
Earth and space science missions. Certainly at risk is the timely 
development of a new, much more capable U.S. human spacecraft to follow 
the Space Shuttle which will be retired in 2010.

Budget Highlights of Agencies of Jurisdiction
National Science Foundation (NSF)
    Funds are requested to increase the budget for NSF to $6.43 billion 
in FY 2008, 45 percent above 2001's $4.43 billion level. Similar 
investments in the past have yielded important scientific discoveries, 
which boost economic growth and enhance Americans' quality of life.
    The centerpiece of the American Competitiveness Initiative is 
President Bush's plan to double investment over a 10-year period in key 
Federal agencies that support basic research programs emphasizing the 
physical sciences and engineering. NSF is one of the three key 
agencies, as it is the primary source of support for university and 
academic research in the physical sciences, funding potentially 
transformative basic research in areas such as nanotechnology, advanced 
networking and information technology, physics, chemistry, material 
sciences, mathematics and engineering.
    NSF has central roles in two previously mentioned Administration 
priority research areas that promise to strengthen the Nation's 
economy: the National Nanotechnology Initiative (NNI) and the 
Networking and Information Technology R&D program (NITRD). NSF-funded 
nanotechnology research, proposed at $390 million in FY 2008, a 5 
percent increase over the 2007 request and 160 percent since 2001, has 
advanced our understanding of materials at the molecular level and has 
provided insights into how innovative mechanisms and tools can be built 
atom by atom. This emerging field holds promise for a broad range of 
developing technologies, including higher-performance materials, more 
efficient manufacturing processes, higher-capacity computer storage, 
and microscopic biomedical instruments and mechanisms. NSF's 
investments in NITRD, funded at $994 million in 2008, up $90 million 
over 2007 and 56 percent since 2001, support all major areas of basic 
information technology (IT) research. NSF also incorporates IT advances 
into its scientific and engineering applications, supports using 
computing and networking infrastructure for research, and contributes 
to IT-related education for scientists, engineers, and the IT 
workforce.
    The 2008 NSF Education and Human Resources (EHR) budget will 
advance efforts to prepare U.S. students for the science and 
engineering workforce with a 7.5 percent increase (+$53 million) over 
the level in FY 2007 CR, adjusted for the movement of EPSCoR to the 
Research and Related Activities account. To further strengthen NSF's 
emphasis on increasing the quality and quantity of the science and 
engineering workforce and ensuring that undergraduate students are well 
prepared for an increasingly technological global society, EHR will 
increase funding for its undergraduate education portfolio by $13.4 
million. This total includes $3.5 million for the Course, Curriculum, 
and Laboratory Improvement (CCLI) program and $5.1 million for the 
Advanced Technological Education (ATE) program to improve technician 
training at community colleges. The FY 2008 EHR budget also provides an 
increase of $8.9 million for the Graduate Research Fellowship program, 
an amount that will support an additional 200 graduate students, and 
$4.53 million for the Centers of Research Excellence in Science and 
Technology, a program designed to broaden participation in the science 
and engineering workforce. The FY 2008 request provides increased 
support for K-12 STEM education including $30 million for new awards 
under the Math and Science Partnerships program. The increases in 
funding for the ATE and CCLI programs also benefit K-12 students, in 
the case of the former by providing support for high school students 
who participate in dual-enrollment or articulated technician education 
programs, and the later which aims to improve undergraduate STEM 
education to all students, including those who will become K-12 
teachers. Similarly, since many research projects and centers include 
education and outreach activities for K-12 students and teachers, the 
increased funding for research also benefits K-12 education.

National Institute of Standards and Technology (NIST)
    The Department of Commerce's NIST ``core'' research and facilities 
receive $594 million in 2008, an increase of 21 percent from the level 
in the FY 2007 CR, which is $42 million below the President's 2007 ACI 
request. In 2008, the American Competitiveness Initiative proposes NIST 
funding increases of $69 million for new initiatives in research and 
measurements in high-leverage areas such as the Disaster-Resilient 
Structures and Communities Program, the interagency Climate Change 
Science Program, and the interagency National Earthquake Hazards 
Reduction Program. Support continues for high-leverage, broad impact 
research in quantum information processing, nanotechnology, and new and 
expanded capabilities at the NIST Center for Neutron Research and at 
its Boulder, Colorado, high-performance labs.

National Aeronautics and Space Administration (NASA)
    The President's 2008 Budget for NASA is $17.3 billion, a 3.1 
percent increase over the President's 2007 request, reflecting a strong 
commitment by the Administration to the continued pursuit of the Vision 
for Space Exploration. The FY 2007 CR, however, reduces the 2007 Budget 
by $545 million to $16.2 billion.
    In 2008, NASA requests $3.92 billion for exploration systems 
including the Orion Crew Exploration Vehicle (CEV) and the Ares I 
launch vehicle that will carry astronauts to the Moon. Having already 
initiated the acquisition process for certain elements of this 
architecture during 2006, NASA anticipates that all Orion CEV and Ares 
I elements will be under contract by the end of 2007, with the first 
crewed-flight planned to occur no later than 2014.
    The 2008 Budget requests $5.52 billion, almost a third of NASA's 
total budget, to continue operating the 59 spacecraft of NASA's Science 
Mission Directorate and to support investments in future Earth and 
space science missions, vital technologies, and frontier research. NASA 
will develop seven new Earth observing space missions, including the 
Landsat Data Continuity Mission and the Global Precipitation 
Measurement mission, which will launch no later than 2013. NASA will 
continue its roles in the interagency Climate Change Science Program 
and the international initiative on the Global Earth Observing System 
of Systems. NASA will also support studies of the Earth-Sun system 
using data from the STEREO mission and the upcoming Solar Dynamics 
Observatory. A new Lunar Science Research program will conduct robotic 
investigations of the Moon as a part of the Vision for Space 
Exploration. Following up its missions to Mars and Saturn, NASA is 
sending ever-more capable spacecraft to Mars, Mercury, the asteroids, 
and Pluto. NASA also will continue its vibrant astronomy program 
through its Great Observatories, and will upgrade Hubble in 2008 to 
provide five more years of productive on-orbit life, while planning new 
spacecraft, such as Webb and Kepler, that will search for planets 
around other stars and peer deep into the universe. Funding for the 
Beyond Einstein program is increased in FY 2008 to act on the 
forthcoming recommendation from the National Research Council regarding 
a strategy to unlock the secrets of the fundamental physics of the 
universe.
    In December 2006, the President approved the Nation's first 
National Aeronautics R&D Policy. Consistent with this Policy, the 2008 
NASA aeronautics budget prioritizes fundamental aeronautics research, 
the improvement of aviation safety, and research that will help support 
the development of the Next Generation Air Transportation System. In 
addition, NASA will address infrastructure upgrades and maintenance 
requirements for aeronautical test facilities across NASA centers that 
are of vital importance to the Nation. The 2008 Budget requests $554 
million for NASA aeronautics, an almost 5 percent increase over the 
2007 request after adjusting for NASA's implementation of simplified 
full-cost accounting.

National Oceanic and Atmospheric Administration (NOAA)
    For NOAA in the Department of Commerce, the FY 2008 Budget provides 
$358 million for Oceanic and Atmospheric Research (OAR), a $20 million 
increase over the 2007 Budget. OAR provides for ongoing research on 
climate, weather, air quality, and ocean processes.
    The 2008 NOAA budget supports a new interagency oceans initiative 
to implement the President's U.S. Ocean Action Plan including $60 
million in new funding over the 2007 Budget to advance oceans science 
and research (of which $13 million is in OAR). Of this $20 million will 
address four near-term ocean research priorities established by the 
Ocean Research Priorities Plan and Implementation Strategy (ORPPIS), 
published in January (with another $20 million from NSF and USGS). The 
NOAA Budget also proposes $40 million to develop an operational ocean 
monitoring network, to delimit the extent of the U.S. Continental 
Shelf, for technology and other infrastructure to support ocean 
science, for International Polar Year activities, and for research on 
protected species and commercial fisheries.

Department of Transportation (DOT)
    The FY 2008 Budget request for highway-related research is $430 
million, consistent with the level in the multi-year surface 
transportation research authorization. Highway research includes the 
Federal Highway Administration's transportation research and technology 
contract programs. These research programs include the investigation of 
ways to improve safety, reduce congestion, improve mobility, reduce 
lifecycle construction and maintenance costs, improve the durability 
and longevity of highway pavements and structures, enhance the cost-
effectiveness of highway infrastructure investments, and minimize 
negative impacts on the natural and human environment.
    The 2008 Budget request for Federal Aviation Administration (FAA) 
Research, Engineering, and Development is $140 million, including $63 
million focused on the advancement of the Next Generation Air 
Transportation System led by its Joint Planning and Development Office.
    In addition, the 2008 Budget requests $12 million for the Research 
and Innovative Technology Administration to coordinate and advance the 
pursuit of transportation research that cuts across all modes of 
transportation, such as hydrogen fuels, global positioning and remote 
sensing. DOT research programs also support the National Nanotechnology 
Initiative, the U.S. Climate Change Technology Program, and the 
President's Hydrogen Fuel Initiative.

Budget Highlights of Other Important Science Agencies
Department of Energy (DOE)
    The Office of Science in DOE (DOE-SC) is one of the three priority 
research agencies in the President's American Competitiveness 
Initiative, supporting scientific studies and infrastructure for a wide 
range of basic research related to potentially significant innovations. 
The 2008 Budget provides $4.4 billion for DOE-SC, an increase of 16 
percent over the level in the 2007 House-passed full-year Continuing 
Resolution (CR), which is $306 million below the President's 2007 ACI 
request. The Budget includes funding for priorities such as 
nanotechnology ($286 million), materials science research facilities 
($699 million), basic research in support of the Hydrogen Fuel 
Initiative ($60 million), the Advanced Energy Initiative ($713 
million), and high-end computing facilities and research ($340 
million). The Budget also completes funding ($45 million) for project 
and engineering design of the National Synchrotron Light Source II, a 
new x-ray light source that will enable the study of materials 
properties and functions at a level of detail and precision (nanoscale) 
never before possible. It continues support for construction of the 
Linac Coherent Light Source--a materials research facility that will 
provide laser-like x-rays allowing an unprecedented real-time glimpse 
of chemical and biological processes, fully funds operations for the 
five nanoscale science research centers, and provides funding for the 
project and engineering design for the upgrade of the Continuous 
Electron Beam Accelerator Facility.
    DOE implements the President's Advanced Energy Initiative (AEI), 
highlighted above. The 2008 AEI Budget proposes:

   $217 million for the solar R&D to accelerate development of 
        cost-effective photovoltaic materials;

   $292 million for the biomass R&D, including $179 million for 
        the Biofuels Initiative and an additional $113 million in 
        supporting basic research, to help enable cellulosic ethanol to 
        become practical and competitive;

   $42 million for development of high-energy, high-power 
        batteries for hybrid-electric and ``plug-in'' hybrid vehicles;

   $40 million for wind energy research to help improve the 
        efficiency and lower the costs of wind technologies, and to 
        help overcome technical and regulatory barriers to more wide-
        scale deployment of wind technologies;

   $108 million for the FutureGen project to develop 
        technologies for a coal gasification plant with near-zero 
        atmospheric emissions; and

   $309 million for the Hydrogen Fuel Initiative, a crosscut of 
        activities at DOE that includes AEI activities to accelerate 
        development of hydrogen production, storage and infrastructure 
        technologies that can help make possible the use of hydrogen-
        powered fuel cell vehicles and infrastructure to support them.

    The 2008 AEI budget also proposes $395 million for the Global 
Nuclear Energy Partnership (GNEP) in Nuclear Energy with the goals to 
demonstrate advanced fuel cycle technologies, to expand the domestic 
use of nuclear power, and to provide for safe, environmentally 
responsible global nuclear energy systems that support non-
proliferation objectives. Full funding of $160 million for the U.S. 
contribution to the ITER international fusion energy project is 
included as well.

Department of Defense (DOD)
    DOD's FY 2008 R&D budget is almost $79 billion. This level of 
funding will support the Department's commitment to transform its 
capabilities and forces for greater agility, while enabling effective 
responses to asymmetric and uncertain challenges of future conflicts. 
These funds will also help address emergent threats through 
countermeasures to biological agents and will advance novel 
technologies to detect and neutralize improvised explosive devices, 
mines, rockets and mortars. DOD provides the largest share of NITRD 
program funding, over $1 billion, to address IT needs for the Nation's 
defense. Likewise, DOD will invest $375 million under the National 
Nanotechnology Initiative, emphasizing development of materials, 
devices and systems that address the national security mission.
    The Science and Technology (S&T) component of the overall DOD R&D 
budget includes basic research (6.1), applied research (6.2), and 
advanced technology development (6.3). At $10.8 billion in the FY 2008 
Budget, DOD S&T exceeds the 2001 enacted level by 21 percent, or $1.8 
billion. From 2000 to 2007, Congressional earmarks to DoD S&T 
quadrupled. For 2007, there were over 1,200 of these adds (totaling 
$2.8 billion), most of which must be identified and tracked down, 
advertised in a way specific to the Congressional mark, evaluated, 
negotiated and awarded, in some way separate from other potential 
awards. This means that those awards consume several times the staff 
and management resources of the average research award, and may not 
even target a military-specific research need. The large number of such 
additions creates impediments to the creation of effective research 
programs throughout the Department, and should be cause for concern to 
Congress as well as to the Administration.
    A total of $1.43 billion is provided for DoD 6.1 basic research in 
2008. This is a nominal increase over the 2007 Budget and represents 
13.3 percent of the DoD S&T Budget, more than last year's 12.8 percent 
share.

Department of Homeland Security (DHS)
    The President's FY 2008 request includes $799 million for the DHS 
Directorate of Science and Technology and $562 million for the Domestic 
Nuclear Detection Office. R&D continues to play a key role in securing 
the Nation against the terrorist threat. The President's 2008 Budget 
maintains an aggressive investment in scientific research, technology 
development, and research infrastructure aimed at continuing to enhance 
our Nation's security. Priority research areas include: $100 million in 
transformational R&D aimed at enhancing our ability to detect, 
identify, and attribute nuclear and radiological materials; $68 million 
for explosives countermeasures research; and $15 million to fund cyber 
security and information assurance R&D.

United States Geological Survey (USGS)
    The President has proposed a budget of $975.0 million for USGS in 
the Department of the Interior in Fiscal Year 2008. The proposed budget 
includes an increase of $3 million for the new oceans initiative 
activities, including $1.5 million in the Coastal and Marine Geology 
program to begin implementation of the Oceans Research Priorities Plan 
and Implementation Strategy. This involves conducting observations, 
research, and sea-floor mapping and developing forecast models. The 
budget also includes $1.5 million in the Hydrologic Networks and 
Analysis program to begin implementation of an interagency National 
Water Quality Monitoring Network that will integrate watershed, coastal 
waters, and ocean monitoring based on common criteria.
    The FY 2008 USGS budget continues funding for operations and 
maintenance of Landsats 5 and 7 at $16 million. The Budget also 
includes $24 million to fund efforts with NASA and the Landsat Science 
Team to continue development of the Landsat Data Continuity Mission.

Environmental Protection Agency (EPA)
    The FY 2008 Budget for science and technology funding at EPA is 
$755 million. Research priorities include supporting the agency's risk 
assessment programs including Air Quality Science Assessments (formerly 
called the Air Quality Criteria Documents) and the Integrated Risk 
Information System (IRIS), and the Science to Achieve Results (STAR) 
program of extramural research and graduate fellowships in areas of 
environmental science and engineering; $69 million is requested to fund 
new and ongoing research in water security, including monitoring and 
surveillance of terrorist threat agents, and post-incident 
decontamination.

Conclusion
    Making choices is difficult even when budgets are generous, but 
tight budgets require priorities to be focused, and program management 
to be strengthened. This year's R&D budget proposal provides robust 
levels of investment that allow America to maintain its leadership 
position in science and move ahead in selected priority areas. The 
American Competitiveness Initiative and Advanced Energy Initiative 
properly focus R&D investments in areas that will increase our economic 
competitiveness, decrease our dependence on foreign oil, and accelerate 
development of clean energy technologies.
    America currently spends one and a half times as much on federally-
funded research and development as Europe, and over four times as much 
as either Japan or China, the next largest investors. Our scientists 
collectively have the best laboratories in the world, the most 
extensive infrastructure supporting research, the greatest 
opportunities to pursue novel lines of investigation, and the most 
freedom to turn their discoveries into profitable ventures if they are 
inclined to do so.
    We lead not only in science, but also in translating science to 
economically significant products that enhance the quality of life for 
all people.
    This budget will sustain this leadership and maintain science and 
technology capabilities that are the envy of the world. I ask that 
Congress fully fund the initiatives advanced in the President's 
proposal. I would be pleased to respond to questions.
                                 ______
                                 
                    Office of Science and Technology Policy
                          Executive Office of the President
                                       Washington, DC, May 17, 2006
Hon. Ted Stevens,
Chairman,
Senate Committee on Commerce, Science, and Transportation,
Washington, DC.

Dear Mr. Chairman:

    I am writing to thank you for your strong and steadfast leadership 
on issues of importance to America's science and technology enterprise, 
and to comment on legislation (S. 2802) that I understand your 
Committee may be considering for markup.
    First, I want to commend you for your efforts to highlight the 
paramount importance of basic research to America's long-term economic 
competitiveness. Your commitment to this issue is greatly appreciated. 
Your support now for the President's American Competitiveness 
Initiative (ACI) specifically will be crucial to the ultimate success 
of this domestic agenda priority.
    As you know, the centerpiece of the ACI is a commitment to double, 
over 10 years, funding for the three key Federal agencies that support 
high-leverage fields of physical science and engineering: the National 
Science Foundation, the Department of Energy's Office of Science, and 
the National Institute of Standards and Technology labs within the 
Department of Commerce. The focus on these priority agencies was born 
out of an extensive and growing recognition that increasing the support 
for the basic research these agencies fund in the physical sciences is 
of critical importance to ensuring America maintains its competitive 
edge.
    The proposed American Innovation and Competitiveness Act endorses 
our common goal of strengthening U.S. competitiveness through science 
and technology. However, I must raise very serious concerns with regard 
to the specific provisions of the legislation. While the President's 
ACI proposal is a targeted effort to focus increased funding on 
existing peer-reviewed research at the three priority agencies, the 
draft bill creates a multitude of new programs at many agencies, which, 
if enacted, would undermine and delay this very research. The 
Administration is strongly opposed to the creation of new bureaucracy. 
Many of the draft bill's provisions would duplicate or complicate 
existing education and technology programs. Others would put the 
government in the position of competing with private investment and 
influencing market decisions in potentially inefficient and 
counterproductive ways.
    While we understand that the draft legislation is still a work in 
progress, the Administration is especially concerned about the 
authorization levels currently under consideration; excessive 
authorization levels may discourage and divert resources available for 
basic research in the physical sciences, thereby jeopardizing our 
shared goal to double funding for basic research at the key ACI 
agencies.
    I hope you will give strong consideration to these concerns as your 
Committee begins consideration of any competitiveness-related 
legislation. I believe we share a common interest in working to 
strengthen America's capacity to innovate and retain its leadership 
position in the global economy, and I look forward to working with you 
toward this goal.
    Thank you again for your leadership on these issues.
            Sincerely,
                                     John H. Marburger III,
                                                          Director.

    Senator Kerry. Thank you very much, doctor, I appreciate 
that.
    Dr. Bement?

   STATEMENT OF DR. ARDEN L. BEMENT, JR., DIRECTOR, NATIONAL 
                       SCIENCE FOUNDATION

    Dr. Bement. Chairman Kerry, Ranking Member Ensign, and 
Members of the Committee, thank you for this opportunity to 
testify on the National Science Foundation's importance to U.S. 
competitiveness.
    NSF's commitment to the science and engineering enterprise 
comes from an abiding belief that knowledge is a powerful force 
for progress.
    NSF works at the frontier of knowledge, where high-risk, 
high-reward research can lay the foundation for revolutionary 
technologies, and tackle complex problems that challenge 
society.
    Quite simply, our investments in fundamental research and 
education aim to improve the quality of people's lives, and to 
keep the Nation safe and growing. The NSF budget for 2008 
reflects this vital agenda and is detailed in my written 
testimony.
    For over 50 years, NSF has been a strong steward of the 
Nation's scientific discovery and innovation process that has 
been crucial to increasing America's economic strength, global 
competitiveness, national security and overall quality of life. 
Despite its small size, NSF has an extraordinary impact on 
scientific and engineering knowledge and capacity.
    While NSF represents only 4 percent of the total Federal 
budget for research and development, it accounts for 50 percent 
of non-life science basic research at academic institutions. In 
fact, NSF is the only Federal agency that supports all fields 
of basic science and engineering research, and the education 
programs that sustain them across the generations.
    NSF relies on a merit-based competitive process that is 
critical to fostering the highest standards of excellence and 
accountability, standards for which NSF is known all around the 
world.
    Not only do we provide funding to the best of the best, we 
prioritize the research funding based on principles that have 
proven to be both robust and visionary over the years. The 
proof of its effectiveness lies in the outcomes.
    NSF-funded results permeate our society--examples include 
Doppler radar, MRI scans, nanotechnology, the Internet, web-
browsers, search engines, bar codes and computer-aided design 
systems. NSF investments have had a profound effect on our 
quality of life and on American competitiveness. Just these 
examples alone have added hundreds of billions of dollars to 
the U.S. economy over the past 15 years.
    I would like to point out just a few other recently funded 
developments with equal promise, some of which illustrate the 
accelerating convergence between the physical and the life 
sciences. NSF's support for cutting-edge research projects 
often serve as bell weathers for solutions to a myriad of 
complex issues facing society.
    For example, implantable generators, with advanced drug 
delivery systems, illustrate nanotechnology's increasing 
contribution to understanding and treating disease. An 
injectible gel to treat spinal cord injuries is the result of 
NSF-supported polymer research. The Lasik eye correction 
procedure has emerged from high-precision laser research, 
funded by NSF.
    On the environmental front, thin film technologies and 
power plastics sufficiently generate power from light, offering 
viable renewable energy resources. Meanwhile, the production of 
plastics from atmospheric carbon dioxide puts the damaging 
greenhouse gas to good use, helping to sustain the environment.
    NSF programs traditionally integrate research and 
education, fast-tracking innovation excellence via hands-on 
learning. For example, NSF-supported Advanced Technology 
Education centers offer industry-sanctioned technician 
education programs. The centers respond directly to industry's 
workforce needs, and graduate technicians who immediately enter 
the high-tech workforce.
    It is important to note that in our efforts to advance the 
frontier, we also aim to enhance developments of the Nation's 
talent pool of scientists, technologists, engineers and 
mathematicians, otherwise known as STEM. The world class STEM 
talent pool, trained through NSF-sponsored research, transfers 
new scientific and engineering concepts from universities 
directly to the entrepreneurial sector as they enter the 
workforce. This may be basic research's most profound and 
lasting impact. This capability is a strong suit in U.S. 
competitiveness, and one of NSF's greatest contributions to the 
Nation's innovation system.
    Another significant contribution is NSF-supported coupling 
programs between universities and the private sector. NSF 
centers programs, such as our Engineering Research Centers and 
Science and Technology Centers, directly invite private sector 
partners to engage in and sponsor related cutting-edge research 
in education that can lead to high-leverage innovations.
    Furthermore, NSF couples investments in our Small Business 
Innovation Research and Small Business Technology Transfer 
programs with high-impact, emerging technologies such as 
nanotechnology, information technology, and bio-technology.
    Today I've only touched on the variety and richness of the 
NSF portfolio. NSF research and education efforts contribute 
greatly to the Nation's innovation economy, and help keep 
America at the forefront of science and engineering. 
Extraordinary discoveries coming from NSF-funded researchers 
and initiatives enrich the entire science and engineering 
enterprise, and make education fun, exciting, and achievement-
oriented. NSF and the National Science Board looks to the 
future, committed to these important considerations, and we 
have crafted our 2008 budget to address them.
    Mr. Chairman, and members of the Committee, I look forward 
to working with you in the months ahead, and would be happy to 
respond to any questions that you may have.
    [The prepared statement of Dr. Bement follows:]

       Prepared Statement of Dr. Arden L. Bement, Jr., Director, 
                      National Science Foundation

    Chairman Kerry, Ranking Member Ensign, and members of the 
Committee, thank you for this opportunity to testify on the importance 
of basic research. It is a pleasure to appear before you again on this 
important topic. I would like to thank the Members of this Committee 
for their support for NSF over the years and specifically for your 
support for NSF in the 2007 Continuing Resolution, the 2008 budget and 
the America COMPETES legislation.
    I am especially pleased to emphasize once again the role the 
National Science Foundation (NSF) plays in sustaining America's 
competitiveness in the global economy. As you are well aware, the 
President's request for NSF represents an 8.7 percent increase over the 
appropriated levels, and will keep NSF on the course set by the 
President's American Competitiveness Initiative (ACI) to drive 
innovation and sharpen America's competitive edge. This year's budget 
reinforces the Administration's firm commitment to doubling overall 
funding for the NSF, the Department of Energy's Office of Science, and 
the Department of Commerce's National Institute of Standards and 
Technology labs over the next 10 years.
    For over fifty years, NSF has been a steward of the Nation's 
science and engineering enterprise, with a track record of producing 
results. NSF investments in discovery, learning, and innovation have 
been important to increasing America's economic strength, global 
competitiveness, national security and overall quality of life.
    Despite its relatively small size, NSF has an important impact on 
scientific and engineering knowledge and academic capacity. While NSF 
represents only 4 percent of the total Federal budget for research and 
development, it accounts for fifty percent of non-life science basic 
research at academic institutions. In fact, NSF is the only Federal 
agency that supports all fields of basic science and engineering 
research.
    NSF relies on a merit-based, competitive process that is critical 
to fostering the highest standards of excellence and accountability--
standards for which NSF is known all over the world.
    We provide funding to the best of the best. Of the 513 individuals 
who have received the Nobel Prize since NSF first awarded research 
grants in 1952, 174 or 34 percent received NSF funding at some point in 
their careers.
    NSF-funded research has led to social benefits. Examples include 
Doppler radar, MRI scans, nanotechnology, the Internet, web browsers, 
search engines, bar codes, and computer-aided design systems. NSF 
investments have played an important role in American competitiveness 
and innovation. The economic returns from these technologies alone have 
added hundreds of billions of dollars to the U.S. economy over the past 
15 years.
    As you well know, investments in fundamental research often yield 
unexpected benefits. One example I like to use is NSF's support of 
abstract auction theory and experimental economics. NSF-supported 
researchers provided the FCC with its current system for apportioning 
the airwaves. Since their inception in 1994, FCC ``spectrum auctions'' 
have netted over $45 billion in revenue for the Federal Government and 
more than $200 billion in worldwide revenues. Although the payoff was 
unexpected at the time NSF started supporting game-theory research, the 
payoff is many times greater than the total investment NSF has made in 
social and behavior sciences over our fifty year history.
    In our efforts to advance the frontiers of knowledge and spur 
innovation, NSF also aims to develop of the Nation's talent pool and 
create a highly skilled workforce. This may be NSF's most profound, and 
lasting, impact.
    Perhaps even more important than the breakthroughs I have described 
above, are the students that have been educated and trained along the 
way, including as participants in prize-winning research. The 
scientists, technologists, engineers, and mathematicians trained 
through the integration of research and education transfer new 
scientific and engineering concepts from universities directly to the 
entrepreneurial sector as they enter the workforce. This capability is 
a strong suit in U.S. competitiveness, and one of NSF's greatest 
contributions to the Nation's innovation system.
    Opportunities to advance the frontiers of research and education 
are more promising than ever before--across every field of science, 
mathematics and engineering. No matter what field of science one 
chooses--from studying the smallest particles of matter, to exploring 
the formation of the cosmos, to understanding dynamic interactions 
among humans or unraveling the complexity of life on Earth--ground-
breaking research is on the horizon. The NSF budget for FY 2008 sets an 
ambitious agenda for capitalizing on this potential to discover new 
knowledge that can help boost the Nation's economic vitality and 
improve our quality of life.
    NSF's commitment to the science and engineering enterprise comes 
from an enduring belief that knowledge is a powerful force for 
progress. NSF works at the frontier of knowledge where high-risk, high-
reward research can lay the foundation for revolutionary technologies 
and tackle complex societal problems.
    Quite simply, our investments in fundamental research and education 
improve the quality of people's lives and contribute significantly to 
our Nation's prosperity. The NSF budget for 2008 reflects this vital 
agenda, and I'm pleased to present it to you today.
    Let me begin with the numbers. Overall, in his FY 2008 Budget 
Request, the President is requesting $6.43 billion for the NSF. That's 
an increase of nearly $513 million, or 8.7 percent above the 2007 
appropriated amounts. Funding at this level in FY 2008 will keep us on 
the course set by the President's American Competitiveness Initiative. 
The ACI aims to expand Federal research investments over the next 10 
years to drive innovation and sharpen America's competitive edge. Our 
task in this ambitious undertaking is to energize the Nation's 
leadership in fundamental research and education that keeps America at 
the leading edge of innovation.
    Funding levels increase for every major NSF appropriations account. 
Investments in Research and Related Activities increase by 7.7 percent, 
and our Education and Human Resources account by 7.5 percent. Rapid 
progress in these areas will generate new concepts and tools with far-
reaching applications, lay the foundations for next-generation tools 
and technologies, and develop educational strategies to engage students 
and prepare them for the fast-changing, global environment. The budget 
includes increases for every Directorate and Office of NSF.
    Our budget priorities for 2008 are based on the long-term 
investment strategies identified in the new NSF Strategic Plan. They 
are focused squarely on the future.

Discovery Research for Innovation
    The first priority is Discovery Research for Innovation. In nearly 
every field of science and engineering, we are moving toward new 
knowledge that will contribute to the resolution of some of society's 
most stubborn problems--in areas such as energy, security, health and 
the environment. And we are on the threshold of technological 
innovations that will power the economy well into the future.
    Today, the most fertile ground for discovery is often at the 
interface among disciplines, where insights from one field inform our 
understanding of another. To explore that territory, our strategy must 
be to keep all fields and disciplines of science and engineering 
healthy and strong. We continue to address that objective in 2008.
    At the same time, we must be constantly alert to research that has 
the potential to overturn accepted paradigms and open entirely new 
fields for exploration. Below I will highlight several of these 
emerging frontiers. But it is important to note that the power of 
transformational research is ubiquitous today across the social, 
physical and life sciences, and engineering.

Cyber-enabled Discovery and Innovation
    The power of new information and communications allows us to 
investigate phenomena of increasing complexity, scale and scope. But 
researchers are finding it increasingly difficult to cope with the 
flood of data from improved observational tools, to assimilate 
different data formats and ontologies--atomic to the cosmic--and to 
find ways to store and archive petabyte-sized databases.
    In 2008, NSF will invest $52 million in a new initiative we call 
Cyber-enabled Discovery and Innovation, or CDI. CDI will explore a new 
generation of computationally-based discovery concepts and tools at the 
intersection of the computational world and the physical and biological 
worlds.
    In every discipline, we need new techniques that can help 
scientists and engineers uncover fresh knowledge from vast amounts of 
data generated by sensors, telescopes, satellites, or even the media 
and the Internet. Understanding complex interactions in systems ranging 
from living cells to binary star systems, or from computer networks to 
societies, also present challenges.
    We need improved simulation and other dynamic modeling techniques 
to support experiments with complex systems--from earthquakes to 
brains--that are not feasible to perform in the physical world.
    Finally, virtual environments have the potential to enhance 
collaboration, education, and experimentation in ways that we are just 
beginning to explore. CDI educational research efforts will center on a 
combination of virtual environments and advanced cyberinfrastructure. 
CDI will tackle all of these challenging research problems.

Ocean Research Priorities Plan
    Understanding the interactions between society and the oceans is of 
vital importance for ensuring a clean, healthy, stable, and productive 
ocean environment. The Ocean Research Priorities Plan (ORPP) lays out, 
for the first time, a national effort to link ocean research to 
societal issues ranging from the stewardship of ocean resources to the 
ocean's role in climate.
    A new NSF investment of $17 million will support fundamental 
research and technology development in four areas identified in the 
Plan as near-term priorities.
    One area of investigation will look at the complex dynamics that 
control and regulate marine ecosystem processes--knowledge that is 
absolutely essential to improve the management of marine resources. A 
second explores variability of the Meridional Overturning Circulation 
in the Atlantic Ocean. This is one element of global ocean circulation 
that is responsible for long-term climate variations along the Eastern 
Seaboard. Research will also address the response of coastal ecosystems 
to events ranging from non-point source pollution to hurricanes.
    A fourth priority is the development of new marine sensors. This is 
also an important objective of the Foundation's Ocean Observatories 
Initiative (OOI). OOI--together with other observatories such as NEON, 
NEES, and GEON--will make an important contribution to GEOSS--the 
Global Earth Observation System of Systems (GEOSS). This research 
complements a much more extensive, ongoing program of ocean research 
and education at NSF.

National Nanotechnology Initiative
    Nanotechnology is an emerging field of immense promise, with 
ramifications for manufacturing, medicine, and next-generation 
computing. With the promise of nanotechnology, we can anticipate 
systematic programs to identify or design a broad spectrum of materials 
with just the right properties for the application in mind.
    We are increasing our investment in the interagency National 
Nanotechnology Initiative by nearly $17 million, to a total of $390 
million, to support fundamental nanoscale research and the development 
of nanomaterials.
    A critical focus of this investment will be a new multidisciplinary 
effort to better understand the environmental, health, and safety 
impacts of nanomaterials. This research will explore the interactions 
between nano particles and materials and the living world at all 
scales. The development of innovative methods and tools to detect, 
characterize, and monitor nano materials in the environment, is an 
important feature of these activities.

International Science and Engineering
    International partnerships are now an abiding feature of the global 
science and engineering landscape. U.S. scientists and engineers must 
remain connected with researchers around the globe to detect movements 
at the frontier and capitalize on new concepts. This is essential if we 
wish to be the first nation of choice for scientists, engineers, and 
students from abroad.
    Moreover, in this era of globalization, international experience is 
fast becoming an essential element in the training of U.S. 
undergraduate and graduate students.
    NSF will support agency-wide activities to expand international 
partnership opportunities for U.S. scientists, engineers and students, 
with an increase of nearly 11 percent for the Office of International 
Science and Engineering, for a total of $45 million.

Preparing the Workforce for the 21st Century
    Creating a strong science and engineering workforce for the future 
is vital to maintaining the Nation's competitive edge. NSF will 
continue to fund a portfolio of highly successful programs.
    You will recognize all of them: CAREER, aimed at junior faculty; 
Advanced Technological Education (ATE) to train skilled technicians and 
technologists; Broadening Participation in Computing, designed to train 
the future IT workforce; Noyce Scholarships, which promote the 
development of a world-class math and science teaching corps; The STEM 
Talent Expansion Program (STEP) and the Centers for Research Excellence 
in Science and Technology (CREST), both of which aim to broaden 
participation of underrepresented groups and engage a broader spectrum 
of institutions, two objectives of vital importance to maintaining 
America's global competitiveness.
    In coordination with the Department of Education, NSF will continue 
funding for the Math and Science Partnership program, aimed at 
improving K-12 science and math education and teaching. Although the 
2008 Request for MSP remains at the FY 2007 level of $46.0 million, 
approximately $30 million will be available for new awards in 2008.
    The budget request also includes funding for an additional 200 
Graduate Research Fellowships (GRF). Together with other NSF graduate 
fellowship, that brings the total number of graduate students supported 
to about 5,375.

Transformational Facilities and Infrastructure
    World-class tools and facilities are every bit as essential for 
discovery. Our strategy is to invest in tools that promise significant 
advances in a field and to make them widely available to a broad cross-
section of investigators.
    For FY 2008, NSF proposes one new start in the Major Research 
Equipment and Facilities Construction account (MREFC): Advanced LIGO 
(AdvLIGO), a gravitational wave observatory that will improve by a 
factor of 10 the sensitivity of current earth-based facilities. 
Observations made with this instrument could revolutionize the field of 
theoretical physics.
    Scientific breakthroughs that are just over the horizon will 
require speeds and abilities that even today's supercomputers cannot 
produce. The development of a petascale computing capability will 
continue to be an important priority for NSF. Our commitment to support 
cyberinfrastructure remains equally steadfast. These investments will 
optimize high-end computing and cyberinfrastructure for science and 
engineering applications--and contribute to the Nation's 
competitiveness in many other ways.
    Funding for the Major Research Instrumentation (MRI) program 
increases by about $24 million to a total of $114 million. In addition, 
we will raise the maximum level of funding within MRI from $2.0 million 
to $4.0 million. These funds support the design and acquisition of mid-
size instruments that are every bit as essential as their big brothers.

International Polar Year (IPY)
    As the lead agency supporting Polar research, NSF will provide U.S. 
leadership for IPY activities through support for an intense research 
and public education effort. The budget request includes nearly $59 
million for these activities.
    In the Polar Regions, we are discerning the outlines of 
environmental change, from sea ice extent, retreating glaciers, 
shifting patterns in flora and fauna, to environmental observations by 
Arctic natives. Such change--whether environmental, biological or 
social--has implications for the rest of the globe. Polar change 
ripples across the planet on a spectrum of time scales, through the 
atmosphere, oceans, and living systems.
    We do not yet fully understand the causes of what we are observing. 
Now is the time to change this, for new tools make possible the needed 
observations and synthesis of knowledge. They range from satellites to 
ships to sensors, and from genomics to nanotechnology, information 
technology, and advances in remote and robotic technologies.
    For these reasons, climate change research and environmental 
observations will be a major focus for NSF IPY activities. Much of this 
research will support the goals of the U.S. Climate Change Science 
Program. Because the scope and scale of climate change is global, U.S. 
scientists will collaborate with scientists from around the world.
    Another IPY research effort will explore how life functions and 
survives in the extremes of the polar regions. A surprising diversity 
of life flourishes in the McMurdo dry valleys of Antarctica, for 
example. Research will focus on microorganisms at various scales, but 
will include a diversity of organisms. Research on humans in polar 
environments will advance our understanding of our species' place in 
the complexity of polar phenomena.
    IPY offers an excellent opportunity for outreach and education to 
raise public understanding of science and engineering and NSF will 
continue to support such efforts.

Stewardship
    Also among our 2008 priorities is Stewardship--our commitment to 
support excellence in science and engineering research and education by 
maintaining a capable and responsive organization. I would be remiss if 
I didn't mention that the success of our post--award and pre--award 
oversight and merit review process depends entirely on our program 
officers and program directors. They all know that the optimal use of 
limited public funds relies on two conditions: Ensuring that research 
is aimed--and continuously re-aimed--at the frontiers of understanding; 
and certifying that every dollar goes to competitive, merit-reviewed, 
and time-limited awards with clear criteria for success. When these two 
conditions are met, the Nation gets the most intellectual and economic 
leverage from its research investments.
    Our 2008 Budget request would provide adequate funding for 
operations and award management i.e., salaries and expenses), 
particularly in the information technology field, which is critical to 
the agency functioning as efficiently as possible. We need to maintain 
our investments in productivity-enhancing tools, including 
cybersecurity, and modernization of information technology as well as 
continue to provide post-award oversight. I applaud Members of this 
Committee for their support for full funding of our FY 2008 budget 
request.
    NSF has just completed a new strategic plan for 2006-2011. As a 
direct result of the strategic planning process, NSF has established 
eight new multi-year objectives for stewardship. We will strengthen our 
traditional partnerships and develop new collaborations with other 
agencies and organizations. We will also expand efforts to broaden 
participation from underrepresented groups and institutions in all NSF 
activities.
    NSF leads Federal agencies in funding research and education 
activities based on competitive merit review, with over 88 percent of 
its research and education funding going to awards selected through a 
competitive merit review process. Improving the transparency, 
consistency, and uniformity of the merit review process is a priority 
for 2008 and into the future.
    An objective for 2008 is establishing the Research.gov portal 
site--a one-stop website for grantees seeking Federal funding. The 
portal will also help research agencies share grants management best 
practices as part of the Grants Management Line of Business.

Conclusion
    Mr. Chairman, I've only touched upon some of the variety and 
richness of the NSF portfolio. NSF research and education efforts 
contribute greatly to the Nation's innovation economy and help keep 
America at the forefront of science and engineering. At the same time, 
NSF-supported researchers produce leading edge discoveries that serve 
society and spark the public's curiosity and interest. Extraordinary 
discoveries coming from dozens of NSF programs and initiatives are 
enriching the entire science and engineering enterprise, and making 
education fun, exciting and achievement-oriented.
    Scientists can now peer back in time to the early years of the 
universe, from its explosive formation to its dark ages, to its first 
stars and mini-galaxies. Seeing this far into the past is a remarkable 
feat of science and engineering creativity and imagination. It is 
imperative that we also use our knowledge to illuminate the future. The 
ultimate reason for the science and engineering enterprise is to put 
knowledge to work for the growth of the economy and the well being of 
society.
    At the beginning of the 21st century, America has the world's best 
cadre of scientists and engineers. We have some of the finest academic 
institutions anywhere. And maybe most importantly, we have a half 
century of experience working to perfect what is commonly acknowledged 
as the most successful system for supporting research, coupled with 
educating our scientists and engineers.
    As this century plays out, there will be an increasing number of 
competent players in the global competition for ideas, talent, and 
innovation. In this context, ``globalization'' is shorthand for a 
complex, permanent, and challenging environment that calls for 
sustainable, long-term responses, not just short-term fixes. The nation 
needs bold efforts, at the most demanding levels of creative 
enterprise, to sustain a leadership role in the global economy.
    In these shifting sands, I believe that America can continue to be 
on the leading edge of ideas and research that can chart the global 
path for the next half century. We want our universities and businesses 
to continue leading the world in discovery and innovation. That means 
cultivating our strengths--U.S. leadership in fundamental discovery--
including high-risk, high-reward transformational research--state-of-
the-art facilities and infrastructure, and a world-class S&E workforce. 
These strategies can help us reinvent American competitiveness in the 
21st Century.
    But make no mistake. Staying at the forefront of discovery and 
innovation will require sustained investments. In a science and 
technology based world, to retreat from the frontier is to put the 
Nation at peril.
    NSF is committed to cultivating a science and engineering 
enterprise that not only unlocks the mysteries of the universe but that 
addresses the challenges of America and the world. The National Science 
Foundation looks to the future with these important considerations in 
mind, and we have crafted our 2008 budget to address them.
    Mr. Chairman and members of the Committee, I hope that this brief 
overview conveys to you the extent of NSF's commitment to advancing 
science and technology in the national interest. I look forward to 
working with you in months ahead, and would be happy to respond to any 
questions that you have.

    Senator Kerry. Thank you very much, Dr. Bement.
    Dr. Jeffrey?

         STATEMENT OF DR. WILLIAM A. JEFFREY, DIRECTOR,

        NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY,

                  U.S. DEPARTMENT OF COMMERCE

    Dr. Jeffrey. Chairman Kerry, Ranking Member Ensign, and 
Members of the Subcommittee. I'm pleased to present the 
President's 2008 budget request for NIST.
    This is a strong budget that will further enhance our 
ability to support the measurements and standards needs of U.S. 
industry and universities.
    NIST has a long history of being at the forefront of new 
innovations through our measurements and standards. In 2003, 
the National Academy of Engineering identified the greatest 
engineering achievements of the 20th century. NIST measurements 
and standards were integral to the successful development and 
adoption of virtually every one.
    Nineteen retrospective studies of economic impact show 
that, on average, NIST labs generated a benefit to cost ratio 
of 44 to 1 to the U.S. economy. The high rate of return results 
from the fact that new measurements or standards benefit entire 
industries or sectors of the economy, as opposed to individual 
companies.
    For example, NIST researchers recently developed new 
measurement techniques that cut up to 80 percent of the cost 
and time for industry to develop advanced materials. As one 
industry scientist put it, ``NIST scientists are re-awakening a 
major element of creativity that analytical science almost 
lost.'' NIST also operates world-class user facilities. Last 
year, approximately 2,000 researchers from 60 different 
industries leveraged the NIST Center for Neutron Research or 
the NCNR. A National Academy of Sciences report describes the 
NCNR's capability to image an operating fuel cell as, ``A 
considerable achievement, and one of the most significant 
analytical advances in the fuel cell realized in decades.'' 
Industry scientists have stated that the research performed at 
the NCNR has allowed them to jump 5 years ahead in fuel cell 
development.
    To prepare for the future, NIST is working with industry to 
identify critical measurement barriers to innovation, 
evaluating its physical infrastructure, forming new and 
strengthening existing partnerships, and updating the way it 
stimulates the knowledge transfer from its labs to industry and 
academia.
    The increased funding provided through the budget request 
will directly support innovative advances in broad sectors of 
the economy, as well as improve the safety and quality of life 
for our citizens.
    For example, the research initiatives will speed the 
development, and foster the adoption of nanotechnology 
products, and provide the physical measurements to ensure their 
safety, accelerate the revolutionary economic potential, in 
exploiting the unique properties of the quantum world, provide 
confidence and reduce uncertainty in measurements supporting 
global climate change models, reduce the risk to communities as 
they encroach on hurricane-prone coasts and fire-prone wild 
land urban interface regions, and enhance safety of new and 
existing structures from the catastrophic impact of 
earthquakes.
    To meet the demands for measurements at ever-smaller 
scales, at faster rates, and with more accuracy requires 
excellent laboratory and user facilities. The budget request, 
therefore, includes capacity and capability improvements at 
both our Boulder campus and the NCNR.
    The budget request for MEP is identical to last year's 
request, and is a reduction of $58.3 million from the 2006 
enacted. I recognize the difference in priority between the 
Administration and Congress, regarding the Federal funding 
level for the MEP program. One thing you can be certain of, 
regardless of the final appropriations, NIST will execute the 
program in the most effective manner possible to support the 
Nation's small manufacturers.
    No funds for ATP are requested in the President's 2008 
budget, the 2006 enacted budget was consistent with the phase-
out of the program. Since the 2007 Continuing Resolution, 
however, included funding for ATP, we have initiated a new 
competition.
    In summary, recent NIST measurements and standards research 
have enabled innovations now embedded in the iPod, body armor, 
saving the lives of domestic law enforcement officers and our 
service men and women overseas, and diagnostic screening 
devices for cancer patients, making their treatment more 
targeted and accurate. The results of NIST research can be 
found in virtually every manufacturing and service industry.
    For more than a century, NIST research has been critical to 
our Nation's competitiveness. The increased funding requested 
for NIST will directly support innovations in broad sectors of 
the economy that will, quite literally, define the 21st 
century.
    Thank you, and I would be happy to answer any questions.
    [The prepared statement of Dr. Jeffrey follows:]

   Prepared Statement of Dr. William A. Jeffrey, Director, National 
Institute of Standards and Technology, Technology Administration, U.S. 
                         Department of Commerce

    Chairman Kerry, Ranking Member Ensign and Members of the 
Subcommittee, I am pleased to appear before you today to present the 
President's FY 2008 Budget request for the National Institute of 
Standards and Technology (NIST). This is a strong budget for NIST and 
it will further enhance NIST's ability to support the measurement and 
standards needs of U.S. industry and universities. The FY 2008 request 
of $640.7 million includes $594.4 million for NIST's core (encompassing 
NIST's research and facilities) and $46.3 million for the Hollings 
Manufacturing Extension Partnership. The budget for the NIST core 
represents an 11 percent increase over the President's FY 2007 request 
and a 21 percent increase over the FY 2007 Continuing Resolution (P.L. 
110-5). This funding supports NIST's mission to promote U.S. innovation 
and industrial competitiveness by advancing measurement science, 
standards and technology in ways that enhance economic security and 
improve our quality of life.

NIST's Impact on Innovation and the Economy
    NIST has a long history of being at the forefront of new 
innovations through our high-impact measurements and standards. In 
2003, the National Academy of Engineering identified 20 of the greatest 
engineering achievements of the 20th century--including automobiles, 
aircraft, lasers, computers, and the Internet. NIST measurements and 
standards were integral to the successful development and adoption of 
virtually every one. Now NIST is paving the way for the greatest 
achievements of the 21st century which are still yet to be imagined.
    NIST's measurement science and standards form part of the 
foundation upon which innovation is built. Just as the Nation's 
physical infrastructure (e.g., roads or power grid) define the Nation's 
capacity to build and transport goods--the Nation has an innovation 
infrastructure which defines the Nation's capacity to innovate. And 
investment in long term basic research like that done at NIST is an 
integral component of the innovation infrastructure. As stated in the 
National Academy of Sciences' Rising Above the Gathering Storm, ``The 
power of research is demonstrated not only by single innovations but by 
the ability to create entire new industries.''
    NIST researchers are world leaders in their fields. They frequently 
arrive at the ``cutting edge'' of science before anyone else. And once 
there, they partner with industry and academia to identify and overcome 
barriers that can slow or even halt the progress of new innovations. 
With the proposed FY 2008 budget, NIST will continue developing the 
measurement and standards tools that enable U.S. industry to maintain 
and enhance our global economic competitiveness.
    NIST continues to meet the Nation's highest priorities by focusing 
on high impact research and investing in the capacity and capability of 
our user facilities and labs. This emphasis is validated by the high 
rate of return to the Nation that the NIST labs already have 
demonstrated. Nineteen retrospective studies of economic impact show 
that, on average, NIST labs generated a benefit-to-cost ratio of 44:1 
to the U.S. economy. The high rate of return results from the fact that 
new measurements or standards benefit entire industries or sectors of 
the economy--as opposed to individual companies.
    NIST supports U.S. innovation and economic competitiveness 
primarily through its measurements, standards, and national user 
facilities. Recent NIST successes highlight the importance of each of 
these critical components and illustrate how NIST's labs are able to 
return such a large benefit to the nation:

        Measurements--NIST researchers recently developed new 
        measurement techniques that allow for rapid and cost-effective 
        assessments of advanced materials that are used in a range of 
        products from new detergents to improved adhesives for next-
        generation electronics. Previously, it could cost industry $20 
        million to develop and understand the characteristics of one 
        new material. With this NIST measurement advance, the cost and 
        time are estimated to have been cut by 80 percent. To 
        facilitate the transfer of this technique to industry, NIST 
        organized an open consortium now consisting of 23 members that 
        are learning to use and adapt these new measurement techniques. 
        As a scientist from Honeywell International put it, ``. . . 
        NIST offers an invaluable resource to show what can be done, 
        and how to go about it. NIST Combinatorial Methods Center 
        scientists are reawakening a major element of creativity that 
        analytical science almost lost.''

        Standards--Nanotechnology has the potential to revolutionize 
        manufacturing. And one of the most promising nanomaterials is 
        the carbon nanotube. Carbon nanotubes have unique electronic 
        and mechanical properties that lend themselves to a variety of 
        applications, ranging from the development of stronger and 
        lighter materials to nanowires and transistors for miniature 
        electronics. Regardless of the potential application, the 
        quality of the materials is paramount. Unfortunately, current 
        production techniques for carbon nanotubes result in products 
        with high levels of uncertainty in their quality and 
        uniformity. To address this concern, NIST is currently 
        developing a carbon nanotube reference material. This reference 
        material, when deployed, can be used by any nanotube 
        manufacturer to validate their product's quality, purity, and 
        consistency and accelerate the adoption of carbon nanotubes 
        into more sophisticated devices.

        National User Facilities--NIST operates world-class user 
        facilities that benefit the entire U.S. research community. 
        Last year, approximately 2,000 researchers from 60 different 
        industries across the country leveraged the NIST Center for 
        Neutron Research (NCNR). One recently developed application of 
        the NCNR was to image the interior of operating fuel cells to 
        help improve the efficiency and durability of these devices. 
        Large and small companies involved in the manufacture or use of 
        hydrogen fuel cells, including General Motors, Daimler-
        Chrysler, Dupont, and PlugPower, have benefited from this new 
        capability. The NCNR is the premier facility in the world 
        providing this capability. A National Academy of Sciences 
        report describes the NIST efforts in regards to fuel cell 
        technologies as ``. . . a considerable achievement and one of 
        the most significant analytical advances in the membrane fuel 
        cell realized in decades. The NIST facility offers the entire 
        fuel cell community unique research opportunities that 
        previously eluded them.'' Industry scientists have stated that 
        the research performed at the NCNR has allowed them to jump 5 
        years ahead in terms of fuel cell development.

    The President recognized NIST's critical role for the Nation as 
part of the American Competitiveness Initiative (ACI). The ACI 
describes NIST as: ``. . . a high-leverage Federal research agency that 
performs high-impact basic research and supports the successful 
technical translation and everyday use of economically significant 
innovations . . .'' Under the ACI, overall funding for NIST's core, the 
National Science Foundation, and the Department of Energy's Office of 
Science is together slated to double by 2016.

Preparing for the Future
    The 21st century will be defined by technology innovations that 
fundamentally change the products and services available, the way they 
are manufactured and provided, and the impact on our quality of life. 
These advances will arise from basic research now beginning in, for 
example, nanotechnology, quantum science, and alternative energies--all 
areas in which NIST has a strong and increasing focus with its 
investments.
    The goal of increasing physical sciences research at NIST (along 
with that supported by the National Science Foundation and the 
Department of Energy's Office of Science) provides a unique opportunity 
to strategically establish the programs, plans, and infrastructure that 
will more than double the impact that NIST has on the economy. To 
prepare for the future, NIST is working with industry to identify 
critical measurement barriers to innovation, evaluating the capacity 
and capability of NIST's physical infrastructure, forming new and 
strengthening existing partnerships, and updating the ways it 
stimulates the knowledge transfer from its labs to industry and 
academia.
    For example, over the past year, NIST worked with over 1,000 
experts from industry and universities to identify measurement barriers 
to innovation in a number of critical industry sectors. Over 700 
technical barriers were identified, analyzed, and documented in a 
report. NIST is now in the process of working with industry, 
universities, and other government agencies to address many of these 
identified barriers over the coming years.
    In terms of facilities, NIST has conducted a rigorous evaluation of 
its laboratory capacity and capabilities on its Boulder, Colorado, 
campus. This review found facilities' shortfalls in our ability to meet 
both current and projected industry and university needs in a number of 
important areas. Examples include the high-speed and high-frequency 
measurements required for electronics, defense, and homeland security; 
measurements and tests at the single atom level; and improved methods 
for measuring time, an area expected to vastly improve navigation and 
positioning systems. Each technical area was evaluated in terms of 
necessary laboratory conditions (to include stability of temperature, 
vibration, and humidity, as well as air cleanliness). As a result of 
this assessment, new laboratory space to meet the Nation's needs well 
into the 21st century is proposed in the FY 2008 budget (Boulder 
Building 1 Extension).
    NIST also serves industry and academia by being a steward of world-
class user facilities. As part of the ACI, NIST identified two 
important opportunities first called out in the FY 2007 budget and 
enhanced in the FY 2008 budget--increased capacity and capability of 
the NIST Center for Neutron Research and creation of the NIST Center 
for Nanoscale Science and Technology. Both of these facilities are 
designed to stimulate progress in support of our Nation's economic 
competitiveness.
    The ACI provides NIST the opportunity to further promote U.S. 
innovation and industrial competitiveness. With focused, world-class 
research and facilities, NIST will have a greater impact on the 21st 
century economy than it did even over the past century.
FY 2008 President's Budget
    The increased funding provided through the FY 2008 request will 
directly support innovative advances in broad sectors of the economy as 
well as improve the safety and quality of life for our citizens. The 
following table summarizes the proposed FY 2008 budget. In this table 
we show both the FY 2007 President's budget and the FY 2007 Continuing 
Resolution (P.L. 110-5) for comparisons as different baselines.

               Budget Summary Showing Both FY 2007 President's Request and P.L. 110-5 as Baselines
                                                   [$ million]
----------------------------------------------------------------------------------------------------------------
                                                              FY 2007
                                                FY 2007     Continuing     FY 2008       Change        Change
                                              President's   Resolution   President's   Between FY    Between FY
                                                Request    (P.L. 110-5)     Request    2008 and FY    2008 and
                                                                \1\                   2007 Request   P.L. 110-5
----------------------------------------------------------------------------------------------------------------
STRS (Labs)                                        467.0         432.8   500.5               33.5          67.7
----------------------------------------------------------------------------------------------------------------
CRF (Facilities)                                    68.0          58.7    93.9               25.9          35.2
----------------------------------------------------------------------------------------------------------------
  Core Subtotal:                                     535         491.4   594.4               59.4         102.9
----------------------------------------------------------------------------------------------------------------
ITS (MEP + ATP) Subtotal:                           46.3         183.6    46.3                  0       (137.3)
================================================================================================================
  TOTAL:                                           581.3         675.1   640.7               59.4        (34.4)
----------------------------------------------------------------------------------------------------------------
\1\ Totals for FY 2007 do not include the 50 percent of the pay raise that was included in P.L. 110-5.

    The FY 2008 budget was formulated with the FY 2007 President's 
request as the baseline. Since P.L. 110-5 provides a smaller budget for 
the NIST core (STRS and CRF) than the FY 2007 President's request by 
$43.6 million, some proposed initiatives in FY 2007 that will not 
receive full funding are implicitly contained within the President's FY 
2008 request. New initiatives and program increases are described in 
more detail below:

Scientific and Technical Research Services (STRS)
Enabling Nanotechnology from Discovery to Manufacture (+$6 million)
    The potential market for products containing nanomaterials is 
estimated at over $1 trillion by 2015. Because of their small size--a 
thousand times thinner than a human hair--nanoscale products require 
entirely novel ways to characterize their physical properties and fully 
exploit their unique characteristics in the manufacture of new 
products.
    In FY 2007, NIST began a major initiative to address the 
measurement barriers hindering rapid development of nanotechnologies. A 
new NIST Center for Nanoscale Science and Technology (CNST) has been 
established that combines both research and a state-of-the-art 
nanofabrication and nanometrology user facility.
    The research initiatives proposed in FY 2008 will build on recent 
NIST advances by:

   Developing ways to measure strength, stress, strain, 
        optical, and electronic properties of nanostructures to improve 
        processes and understanding of failure mechanisms;

   Creating three-dimensional, high-resolution imaging methods 
        that reveal details of structure, chemical composition, and 
        manufacturing defects and allow researchers to view 
        nanostructures as they interact with their environment;

   Simulating nanoscale phenomena with computer models to allow 
        economical development of production methods for complex 
        nanodevices; and

   Producing the measurement techniques required to address the 
        interagency efforts to characterize nanotechnology impacts to 
        our health, safety, and environment.
Measurements and Standards for the Climate Change Science Program (+$5 
        million)
    The climate is changing. Determining how fast it is changing, and 
understanding the complex relationships between all the environmental 
variables is a critical objective of the U.S. Climate Change Science 
Program. Many different climate monitoring systems in space, in the 
air, and on the ground are currently monitoring solar output as well as 
trapped and reflected heat by the Earth's atmosphere. These systems are 
operated by many countries and research groups. Establishment of 
absolute calibration and standard references will allow accurate 
intercomparisons of these systems, will help identify small 
environmental changes occurring over many years, and will reduce 
uncertainties in the data input to global climate change models.
    With the proposed FY 2008 funding, NIST will, working in 
coordination with other agencies, develop:

   An international irradiance measurement scale to be used in 
        rigorously calibrating satellite light intensity instruments 
        prior to launch to ensure sufficient accuracy to allow valid 
        comparisons among results from different instruments or from 
        data sets taken over different periods of time;

   New instrument design strategies and quality assurance 
        programs to optimize accuracy and stability of satellite-based 
        irradiance measurement systems;

   Techniques for generating specific types of aerosols in the 
        laboratory, measuring aerosol optical and physical properties, 
        and for simulating aerosol properties that cannot yet be 
        measured in the laboratory; and

   A database of critically evaluated data on aerosol 
        properties collected at NIST and elsewhere.

Enabling Innovation Through Quantum Science (+$4 million)
    Unlike the laws of physics that govern our ``every day'' world, the 
laws of physics that govern the quantum world of atoms, electrons, and 
light particles are fundamentally different. These quantum particles 
are able to interact in ways that according to human experience would 
seem impossible. For example, a quantum particle can actually be in two 
different places simultaneously.
    Conceptualizing these phenomena is difficult to say the least, but 
developing ways to exploit them for the development of technologically 
significant innovations is even more challenging. NIST, however, has 
world-class scientists who are leaders in the emerging field of quantum 
information science. Three NIST scientists have won Nobel Prizes in the 
last 10 years based on their work in this field. Many of the best minds 
in physics today believe that applications of quantum science will 
transform the 21st century just as integrated circuits and classical 
electronics revolutionized the 20th century.
    The proposed FY 2008 initiative will build upon NIST's significant 
expertise in this area, and leverage the collaborations established in 
the recently created Joint Quantum Institute between the University of 
Maryland, NIST, and the National Security Agency. NIST proposes to 
accelerate the potential of the quantum world for enhancing our 
Nation's competitiveness through research into:

   Quantum ``wires'' that use ``teleportation'' techniques to 
        reliably transport information between the components of a 
        simple quantum computer;

   Quantum memory analogous to the random access memory of 
        today's computers to allow more complex logic operations;

   Quantum conversion processes that transfer information from 
        one form of quantum information to another (for example, ways 
        to transfer information about the quantum characteristics of an 
        atom to a photon); and

   Quantum based measurement tools such as optical clocks and 
        single electron counters.

Disaster Resilient Structures and Communities (+$4 million)
    The past few years have reminded us that both natural hazards--
including extreme winds, storm surge, wildland fires, earthquakes, and 
tsunamis--as well as terrorist actions, are a continuing and 
significant threat to U.S. communities. The disaster resilience of our 
physical infrastructure and communities today is determined in large 
measure by the building codes, standards, and practices used when they 
were built. Many of these legacy codes, standards, and practices--which 
have evolved over several decades--are oversimplified and inconsistent 
with current risk assessments. As construction and rebuilding costs 
continue to rise, there is increasing recognition of the need to move 
from response and recovery to proactively identifying and mitigating 
hazards that pose the greatest threats.
    The proposed FY 2008 initiative will, working in coordination with 
other agencies, develop:

   Standard methods to predict losses, evaluate disaster 
        resilience, and estimate cost-to-benefit of risk management 
        strategies at the community and regional scales that local 
        officials can use to evaluate and mitigate risks via land-use 
        planning and practices;

   Decision-support tools to modernize codes, standards, and 
        practices consistent with the risk;

   A validated ``computational wind tunnel'' for predicting 
        extreme wind effects on structures; and

   Risk-based storm surge maps for the design of structures in 
        coastal regions.

National Earthquake Hazards Reduction (+$3.25 million)
    Many earthquakes strike without warning. Within the U.S., more than 
75 million people are located in urban areas considered to be of 
moderate to high risk of earthquakes. Just the economic value of the 
physical structures within these regions--not including the potential 
loss of life and economic disruption--is valued at close to $8.6 
trillion. To address this threat Congress has provided longstanding 
support for the National Earthquake Hazards Reduction Program which 
NIST coordinates across the Federal Government.
    This initiative will enhance the safety of:

   New structures by establishing and promoting performance-
        based standards for entire building designs and by accelerating 
        the adoption of basic research into the model building codes, 
        standards, and practices; and

   Existing structures through research on actual building 
        performance in earthquakes; developing structural performance 
        models and tools; and establishing cost-effective retrofit 
        techniques for existing buildings.

Construction of Research Facilities (CRF)
Building 1 Extension (B1E)--Enabling Sustained Scientific Advancement 
        and 
        Innovation (+$28 million)
    When President Eisenhower dedicated the NIST facilities in Colorado 
in 1954, no one imagined that half a century later scientists would be 
manipulating matter atom-by-atom. Such technological advances require 
increasingly complex and difficult measurements--to be able to observe, 
characterize, and create structures at ever smaller spatial scales. As 
the structures shrink in size, small fluctuations in temperature, 
humidity, air quality, and vibration begin to distort the results. We 
are now at the point where laboratory conditions are inhibiting further 
advances in some of the most promising areas of research for the 21st 
century.
    The $28 million proposed in the FY 2008 budget will leverage 
previously proposed funds ($10.1 million) in the FY 2007 budget to 
construct state-of-the-art laboratory space that will meet the 
stringent environmental conditions required for 21st century scientific 
advances. An additional $38.1 million will be needed in FY 2009 to 
complete the project. With a total cost of $76.2 million, the Building 
1 Extension is the most cost-effective approach to enabling world-class 
measurement science in support of some of the country's most important 
economic sectors.

NIST Center for Neutron Research (NCNR) Expansion and Reliability 
        Improvements (+$19 million)
    The NCNR is widely regarded as the most scientifically-productive 
and cost-effective neutron facility in the U.S., and serves more 
scientists and engineers than all other U.S. facilities combined. 
Neutron scattering techniques, in which beams of neutrons are used as 
probes to see the structure and movements of materials at the smallest 
scales are critical in a wide range of applications that will define 
the 21st century including nanotechnology, alternative energies, and 
understanding the structure of biological molecules. Because of the 
unique properties of neutrons for probing materials and their 
applications to some of the most advanced technologies, a significant 
shortage of neutron beam capacity and capability exists in the U.S. to 
satisfy the demands of industry and academia.
    This initiative begun in FY 2007 is the second-year of a planned 
five-year program to expand significantly the capacity and capabilities 
of the NCNR. The program includes the development of a new neutron cold 
source together with a new hall to house the guide tube, modernization 
of the control system, and five new world-class neutron instruments. 
The specific FY 2008 funding will complete construction of the new 
guide hall.

Industrial Technology Services
Hollings Manufacturing Extension Partnership (MEP) ($46.3 million--no 
        change from FY 2007 President's request; -$58.3 million from 
        P.L. 110-5)
    The MEP program is a partnership between the Federal Government and 
local officials to provide assistance to small and medium sized 
manufacturers around the country. Surveys taken of companies 1 year 
after receiving MEP assistance indicate a significant financial benefit 
accrued to the individual company.
    The Federal Government is an important partner in the MEP program. 
Specifically, the Federal Government:

   Develops new services and programs in response to the 
        evolving manufacturing environment and propagates them 
        throughout the network;

   Evaluates and ensures high-quality performance of every 
        member of the network; and

   Ensures that small manufacturers remain the focus of the 
        effort.

    The above Federal role can be accomplished within the requested 
budget. The reduction of Federal funds to the local centers may have to 
be compensated through a combination of increased fees derived from the 
benefits accrued by individual companies and cost-savings in the 
operations of the centers.

Advanced Technology Program (ATP) ($0--no change from FY 2007 
        President's 
        Request)
    No funds for ATP are requested in the President's FY 2008 budget. 
The FY 2006 enacted budget and the 109th Congress' House mark and 
Senate Appropriations committee mark were consistent with the phase-out 
of the ATP program. The last new awards were made in 2004 and 
sufficient funds were available in the carryover to complete all awards 
and provide government oversight.
    The FY 2007 Continuing Resolution (P.L. 100-5) includes funding for 
the ATP program. NIST will work with Congress to ensure the funds are 
executed in the most effective manner to promote U.S. industry's 
competitiveness.

Summary
    Measurements and standards are the bedrock upon which any economy 
stands. Our founding fathers recognized this. The Constitution assigns 
the Federal Government responsibility to both issue money and to ``fix 
the standards of weights and measures.'' The two are actually more 
similar than they might seem at first glance.
    All economic transactions rest fundamentally on trust--trust 
between two parties that a given amount of something is worth a given 
amount of something else. Helping to create that trust for innovative 
new technologies is the common theme that runs through all of NIST's 
proposed FY 2008 research initiatives. Each helps build a missing or 
inadequate measurement base--a rigorous, accepted way of quantitatively 
describing something--that improves confidence in scientific results or 
improves the quality, reliability or safety of innovative products. 
Recent NIST measurements and standards research have enabled 
innovations now embedded in the iPod, body armor currently saving the 
lives of domestic law enforcement officers and our service men and 
women overseas, and in diagnostic screening devices for cancer patients 
making their treatment more targeted and accurate. The results of NIST 
research can be found in virtually every manufacturing and service 
industry.
    For nearly 106 years, NIST research has been critical to our 
Nation's current and future competitiveness. The increased funding in 
the President's FY 2008 budget for the NIST core will directly support 
technological advances in broad sectors of the economy that will quite 
literally define the 21st century--as well as improve the safety and 
quality of life for all our citizens.

    Senator Kerry. Thank you very much, Dr. Jeffrey.
    Thank you, all of you, I appreciate it.
    I guess we'll do a loose 5-minute round, and try to, since 
there are only three of us here now, see what happens, four of 
us.
    Each of you has come before the Committee and obviously 
articulated what you think you can do, these programs are very 
important, and we obviously respect and appreciate what you're 
doing. And we all understand that you have to operate within 
constraints.
    You're the top science standards/research spokespeople for 
the Nation but, as I listen to you say, in a very direct way, 
and albeit, the President's budget for 2008 has a request of 
$143 billion for the R&D funding. Analysis by the American 
Association for the Advancement of Science shows that 58 
percent of that budget, $83 billion, is going to defense-
related R&D, $60 billion or 42 percent for non-defense, and the 
request is very heavy on development, about $82.8 billion 
totally.
    Even after the proposed increase in the ACI agencies, NSF, 
NIST, DOE Office of Science, funding for basic and applied 
science research overall would fall 2 percent. R&D at NASA and 
ACI would, for the new space vehicle, rises, but the request 
for domestic R&D at other agencies would also fall, with cuts 
of 10.8 percent for the Department of Agriculture, 9.5 percent 
for NOAA, and a continued decrease in R&D funding for the 
Department of Homeland Security.
    How do we reconcile this sense that you come in and say, 
``Well, this is overall increase,'' in fact, here's a chart--I 
wish I had it blown up, I apologize that I don't, you can't 
really see if from there, but maybe you can see some colored 
lines. This is 2001 here, you see the high line for NIH when we 
did the doubling, and the trend line has been downward since 
then. These are in inflation-adjusted dollars, now inflation-
adjusted dollars are what everybody has to deal with, the 
reality of what can you purchase and what do you get, even 
though the dollars may go up.
    Likewise if you look in other sectors, NSF goes slightly 
up, and down in USDA, and very much down in DoD S&T. The bottom 
line is, we're not growing in the basic and applied research 
areas. Isn't that dangerous for our long-term competitiveness?
    Dr. Marburger. There's no question that basic research is a 
primary Federal obligation, Federal role, and that the ACI and 
similar initiatives have a focus on basic research.
    Regarding the specific numbers and the details of the 
budgets for this year, and the budget behaviors, there's no 
question the President has attempted to restrain spending, and 
within the existing resources has set priorities that do 
emphasize basic research in areas that have been historically 
underfunded, relative to their importance to----
    Senator Kerry. Such as what, doctor?
    Dr. Marburger. Such as physical sciences and mathematics, 
computer sciences, in particular, which have been underfunded 
with respect to some other areas of science. And the ACI 
specifically calls out these three priority agencies, which 
have been mentioned here today, for special treatment.
    That is not to say that the other areas do not also enjoy 
priorities, I believe that the--that the expenditures through 
the Department of Defense are extremely important to maintain 
our competitiveness in technology, and I also believe that the 
expenditures for things like climate change, and environmental 
studies, Earth observations are extremely important, and this 
budget attempts to identify priorities in those areas and fund 
them at levels that maintains our leadership in precisely these 
areas.
    Senator Kerry. If I could just interrupt you for a second. 
We had already agreed, Congress and the President, on a NSF 
authorization in 2002 that promised a 5-year doubling effort by 
2007. In effect, the 2007 request fell nearly $4 billion short 
of the previous doubling target. So it's not sufficient, it 
seems to me, to come in and say, ``We're going up,'' when we're 
actually not meeting the goal we set.
    Dr. Marburger. I believe this budget does request 
appropriate amounts for the National Science Foundation. We 
would like to see us on a doubling track, as the Initiative 
very clearly states, and we're disappointed that----
    Senator Kerry. Why are we not? What's the precedent of 
priority, in your judgment, that we're not doing that?
    Dr. Marburger. The--I'm sorry, I don't understand----
    Senator Kerry. You said, ``There are priorities here, the 
reflection of priorities.'' Does this reflect the request that 
you put in? Did you ask for the full doubling?
    Dr. Marburger. The, the--I'm sorry, the ACI has a doubling 
for these agencies over a period of 10 years on a schedule that 
we've circulated in the policy documents for this Initiative. 
The President has funded the National Science Foundation at 
above-inflation rates, during the previous several years. Now 
under the ACI, which clearly responds to a number of reports 
and expert committees and advice, the President is requesting 
funding on a doubling track. And that's, that's very clear. 
We're disappointed that Congress has failed to enact the ACI 
through the Continuing Resolution, falls short by nearly a half 
a billion dollars, and we'd like to get that back on track, and 
move ahead.
    Senator Kerry. What I'm trying to wrestle with here is the 
disparity between the discussion about where the priorities 
ought to be, and then where the funding is. Because the overall 
budget for NSF, I can see, increases, that I understand. But, 
the education and human resource budget, which seems to be 
central to the goals that we've talked about, decreases. I'm 
trying to figure out how you reconcile that.
    Dr. Marburger. The President has requested increases for 
those areas in this budget, and we believe that those increases 
are appropriate for the goals and the existing programs within 
the National Science Foundation. We think that it is 
appropriate for the National Science Foundation to have 
programs in this area, and the President has requested funds 
for them, commensurate with the aims of those programs.
    Senator Kerry. Well I seem to see here that there's a NSF 
Education and Human Resource decrease of 5.8 percent, from $797 
million in 2007, down to $750 million in 2008, despite the fact 
that the President, as you said, is promoting STEM education, 
and Congress has authorized new education programs. The money 
itself is going down.
    Dr. Marburger. My understanding is that the President has 
requested increases in key programs in the National Science 
Foundation for these--we have the Director of the National 
Science Foundation here, he might be able to clarify the 
details of this. But, the President is committed to improving 
both K through 12 education, and education in other sectors 
that lead to STEM workforce increases.
    Senator Kerry. Well, let me ask this----
    Dr. Marburger. Not only through the National Science 
Foundation, but also through the Department of Education as 
well, and other appropriate agencies.
    Senator Kerry. Dr. Bement, maybe you can help us here. Some 
of the most effective programs within NSF, aside from the 
scientific discovery, are the education and human resource 
programs, you'd agree with that?
    Dr. Bement. Fully agree.
    Senator Kerry. And those programs are specifically designed 
to try to attract students to science, technology, engineering, 
mathematics, which we've all heard from each of the Senators is 
a critical focus, a priority.
    But the 2008 budget, if you exclude the Experimental 
Program for Competitive Research, the EPSCoR Program, which was 
transferred to the Director's Office last year, if you set that 
aside, the fiscal year funding for the core EHR Programs has 
declined, from $844 million to, a request now of $750 million. 
I'm trying to see how you reconcile that.
    Dr. Bement. Senator, most of that decline is in one 
program, that's the Math and Science Partnership Program----
    Senator Kerry. And what's the judgment about that program?
    Dr. Bement. I'm sorry?
    Senator Kerry. What is the judgment about that program that 
would bring about a decline?
    Dr. Bement. I think the program has been very effective----
    Senator Kerry. Then, isn't that a priority, according to 
what we've said, to get more students capable in math? The 
Chairman was here a moment ago, he talked about math, science 
performance, the numbers of engineers, et cetera?
    Dr. Bement. Well, since the beginning, the Math and Science 
Partnership Program has been a partnership with the Department 
of Education, and it was a matter of judgment what that balance 
should be over time. The role of the National Science 
Foundation has been to carry out research and development in 
terms of pedagogy and instructional materials and so forth, 
that would meet the goals of No Child Left Behind, and would 
stimulate performance against those goals. And we have 
demonstrated that we have improved performance in the programs 
that we have funded, all of which have been peer-reviewed, 
they're all competitive.
    Now, the question is, in terms of scalability, and in terms 
of transferability, in building up the impact of those 
programs, it requires resources well beyond what the NSF can 
provide, and it would be inappropriate for the NSF to do the 
scalability and the transferability, that ought to be a 
partnership with the states. And we do partner with the State 
Math and Science Partnership Program, funded by the Department 
of Education, so that's been a very close partnership, and 
those--those priorities have changed over the last 4 or 5 
years, the net result has been a decrease in the NSF part of 
the overall program.
    Dr. Marburger. But an increase in the Department of 
Education programs that fund similar STEM-oriented teaching 
improvements.
    Senator Kerry. Do you know how much, by how much?
    Dr. Marburger. I don't have the details, I'll be glad to 
provide them.
    Senator Kerry. We'll look forward to, maybe we can----
    [The information previously referred to follows:]

Department of Education Funding for the Math and Science Partnerships 
Program:

        FY 2008 (requested): $182.1 million

        FY 2007: $182.2 million

        FY 2006: $182.2 million

        FY 2005: $179.5 million

        FY 2004: $149.1 million

        FY 2003: $100.3 million

        FY 2002: $12.5 million

Department of Education Funding for other programs supporting related 
STEM-oriented teaching improvements at the K-12 level (Math Now, 
Advanced Placement, Adjunct Teachers):

        FY 2008 (requested): $397 million

        FY 2007: $37 million

        FY 2006: $32 million

        FY 2005: $30 million

        FY 2004: $24 million

        FY 2003: $23 million

        FY 2002: $22 million

    Dr. Marburger. But, the idea is to continuously increase 
investment in No Child Left Behind, and the Math and Science 
Partnership, in particular.
    Senator Kerry. Thank you. My time is up.
    Senator Sununu?
    Senator Sununu. Thank you very much. Let me at least start 
by talking about a very different subject--invention. And, in 
particular, I want to call your attention to language in the 
House competitiveness bill, and this gets at one of the 
concerns that I was raising about dilution of mission from 
investment in basic science and mathematics. There is a 
provision in the House bill that called for research on 
innovation and inventiveness. And, I would like each of you 
just to comment on how this kind of initiative can be defined, 
and whether or not you think National Science Foundation money 
ought to be carved out for this purpose.
    It says, ``In carrying out its research programs on science 
policy, and the science of learning, National Science 
Foundation may support research on the process of innovation, 
and the teaching of inventiveness.'' Now, again, my personal 
experience here is limited, although I worked for 4 years in a 
manufacturing capacity for a gentleman named Dean Kamen, who I 
honestly believe is the most gifted inventor I've ever met. 
Dean has some weaknesses, he has a very limited wardrobe, for 
example, for those that have met him----
    [Laughter.]
    Senator Sununu.--but he is a brilliant inventor. He's also 
a college dropout. And, it's my experience that it's very 
difficult to really characterize where this gift comes from. 
And, in fact, the only common denominator I think you can find 
among great inventors is--especially on the technology side--an 
interest, an interest in technology, in science, in 
mathematics. I get back to the basic concern I raised earlier, 
that that is driven, that's inspired in 5th grade and 6th grade 
and 7th grade and 8th grade, and I know it was in Dean.
    And, it's a great concern to me to start carving out 
resources at the National Science Foundation to try to 
characterize or quantify the unquantifiable.
    And, I'll offer one other example, before I ask you each 
for a comment, and that is, one of the other great inventors of 
our time, and, in a slightly different area of technology, that 
is, software development, is a gentleman named William Gates, 
some of you may have heard of him----
    [Laughter.]
    Senator Sununu. He is also a college dropout. Now, there 
are some people, maybe, without a great technical background, 
and some people I know with a great technical background that 
would love to take those data points, extrapolate, and start 
encouraging kids to drop out of college, because that's 
obviously a determining factor in becoming a great inventor, 
but that's not the case. That's obviously not the case.
    The point is, it's so hard to characterize the gift, but 
again, both of them--whether you're Bill Gates or Dean Kamen, 
the key is an interest in technology, an interest in science, 
an interest in what makes things work, and that didn't start 
when they were freshmen in college, just prior to dropping out, 
it didn't start when they were seniors in high school. It 
started much earlier than that. Comments? Dr. Marburger?
    Dr. Marburger. As a matter of policy, we have no complaints 
about, or concerns about NSF investing in researchers to study 
issues like this, about what is it that leads to innovation, we 
think that's important. The concern would be to, a carve-out, 
or some limitation on NSF's ability to direct, or not to 
direct, funding in that area. We think that the National 
Science Foundation does support useful research on what it 
takes to do innovation on social sciences that are relevant to 
innovation and competitiveness, but we would like not, to see 
them not constrained to spend a fixed portion of their budget 
on any area, but rather to leave it up to the judgment of the 
community that does the work.
    Dr. Bement. Thank you, Senator, for that question.
    Now, this is indeed a focus of NSF's investment in 
education, to teach creativity and innovation through hands-on 
learning, through inquiry-based learning, and also to couple 
informal education with formal education so that children have 
experiences in and outside the classroom that stimulate their 
curiosity and inventiveness.
    I can tell you that we're seeing this now happen in pre-
school, in early grades--I've attended some classes in 6th 
grade where they're teaching engineering, for example. And this 
is, what I think, will stimulate inventiveness.
    We also, through our social science program, are looking at 
what constitutes creativity and inventiveness, and that will 
couple into our education programs.
    A lot has to do with cognition, child development, learning 
what science children can learn early, and also how to evaluate 
their learning in those subjects.
    Dr. Jeffrey. Thank you. Obviously, I have nothing to add 
over my two colleagues who I agree with completely, so----
    Senator Sununu. Thank you.
    Getting back to the issue of the carve-out, though, and 
that is my principle concern, is that Congress not start 
directing the National Science Foundation where to put its 
money, how much and in what time sequence. And again, in the 
House bill there are 3.5 percent of the funds required to go to 
early career awards for science and engineering researchers.
    I know this is a program that you value, but not only is 
there a requirement that 3.5 percent go to those career grants, 
but there's also 1.5 percent that has to go to the graduate 
education and research grant program, there's a minimum award 
size set at $80,000 for 5 years, would you like to speak to 
this issue of micromanagement, and whether or not the 
limitation on your flexibility is a cause for concern?
    Dr. Bement. Yes, I would, and thank you for that question.
    Prioritization within the Foundation is an organic process, 
it's a daily process. Some of our priorities are handed down by 
the Congress, by the Administration, and our job is to put 
together the best programs and the best science to address 
those priorities.
    In addition to that, we get priorities from the community, 
in terms of what science is worthy of supporting, where the 
frontier is moving forward, and in many cases, where 
opportunities far exceed the available resources, they also 
have to help us in prioritizing where those resources go.
    Those priorities are reviewed by the National Science 
Board, by the Office of Science and Technology Policy, and by 
the Office of Management and Budget. Along with setting 
priorities is balancing our program. Balance between support 
for Education and Human Resources versus Research and Related 
Activities. Balance between support for young investigators 
versus more senior investigators. Balance between 
instrumentation and tools, and discovery research.
    That balance can very easily be upset. And when we get 
carve-outs and when we get language that sets dollar amounts or 
dollar limits, it under-optimizes, if you will, the overall 
program at the NSF, and the effectiveness of the overall 
investment.
    Senator Sununu. Thank you.
    One final question, Dr. Marburger, I mentioned the 34 
different Science, Technology, Engineering, and Math Programs, 
supported by the National Science Foundation, dozens of others 
in different parts, and at different Departments and agencies 
within the Federal Government. There's also a proposal in our 
Senate competitiveness bill to have the Department of Energy 
work to establish specialty schools for science, math and 
engineering. Could you comment on both of these issues? One, 
what is the Administration's perspective on the number of 
Science, Technology, Engineering, and Math Programs, education 
programs, what can be done to better coordinate their 
activities? And second, do you think the Department of Energy 
is the best agent for working to develop and create specialty 
schools for math and science?
    Dr. Marburger. Senator, thank you for the question--there's 
no question that there are too many of these programs, and they 
really need to be consolidated and optimized, and the 
Administration is beginning to do that through a process that's 
jointly sponsored by the Office of Management and Budget----
    Senator Kerry. When you say too many of these programs, too 
many within various agencies, government-wide?
    Dr. Marburger. There are approximately 100 of these 
programs, and multiple programs within each agency and they 
have not been uniformly assessed or coordinated in the past. 
And, we're just beginning to do that.
    This Committee will be pleased to note that the National 
Science Foundation comes out rather high on the ratings, they 
know how to do these programs and they're pretty effective. Not 
every agency is set up to do this. Specifically, with respect 
to the Department of Energy, there are assets in the Department 
of Energy, the National Laboratories are fascinating places, 
they provide mentoring for science projects and so forth, 
teacher training, but I believe that the most important mission 
of the Department of Energy is the basic research and the 
operation of the facilities that they provide--these missions 
are essential to the future competitiveness and innovation of 
our Nation, and they need to be funded more than they are 
today.
    And, when it comes to priorities, that would be our first 
priority--getting the money back into the Office of Science 
laboratories and programs, and letting them respond to the 
science community regarding the priorities for funding.
    Education would not be my first choice as a function or a 
mission for the Department of Energy. It's an ancillary 
function that needs to be managed very carefully in the context 
of their overall program. I believe that the new programs that 
are proposed for the Departments of Energy and Education have 
the potential for diffusing any new resources that we have 
available to put into that agency.
    Senator Kerry. Thank you very much, Senator.
    Senator Pryor?
    Senator Pryor. Mr. Chairman, please let Senator Thune go, 
he was here before me, and I can stay for a few more minutes, 
so please let him go.
    Senator Thune. I thank the gentleman for yielding.
    Thank you, Mr. Chairman.
    I'm particularly interested in--our Nation's energy policy. 
I come from a state that's rich in renewable energy sources 
such as bio-fuels and wind, but it's not simply a parochial 
issue for me. I think energy research and energy policy are 
very much connected to our national security, and I guess I 
would ask whether or not the U.S. is doing enough basic 
research today to get us to energy independence, via clean, 
renewable sources during my lifetime, and if not, what more or 
what else should we be doing.
    Dr. Marburger. Let me just venture a short response to 
this. One of the reasons that we would like to see the budget 
of the Department of Energy Office of Science increase, is that 
they have a lot to offer on basic research for materials and 
processes that feed into energy independence and climate change 
issues. And this is why it's so important to maintain the pace 
of the President's American Competitiveness Initiative. 
Unfortunately, we did not maintain that pace for the Department 
of Energy Office of Science this past year, and I hope we can 
catch up again this year. They have a very important role to 
play there. Obviously, we're not investing as much as we should 
be in that area, the President has requested funds to correct 
that.
    Dr. Bement. I would say that more attention needs to be 
given to basic research. Certainly the efficiency of solar 
cells could be improved. It may be a point of diminishing 
return, but we're seeing opportunities for improving their 
overall effectiveness.
    We're seeing science being applied to how to make plants 
more susceptible to cellulose breakdown for ethanol production, 
through modification. We're also seeing breakthroughs in fuel 
cell technology, where you could begin to match power cycles, 
which has been illusive in the design of fuel cells.
    Energy is an important enough area where basic research 
from more than one agency is critically important. The research 
that the NSF supports goes to support graduate students at 
universities, those will be the people who will take that 
knowledge into the private sector, and be very innovative in 
taking new concepts, new ideas, and developing whole new 
approaches to renewable energy generation, and energy 
sustainability in general. Not only how to generate energy, but 
how to conserve it, as well.
    Dr. Jeffrey. If I could just add a few words to that, of 
course, there are a number of programs, for example, that are 
under the ACI that are very high priority. I mentioned in my 
opening statement, some of the work at the NIST Center for 
Neutron Research and the impact that being able to use neutrons 
to image fuel cells have made a huge increase in their 
efficiency and productivity. That's a major priority for us 
under the ACI and we did get adequate funding under the 2007 
Continuing Resolution to stay on track on that program.
    Another is supporting a hydrogen fuel initiative, to allow 
for hydrogen to actually be used as a portable fuel. There's a 
lot of work that needs to be done there, that we're doing in 
conjunction with the Department of Energy, that was not fully 
funded, unfortunately, under the 2007 Continuing Resolution, 
but again, we hope to be back on track in 2008.
    I'd like to add and follow up on a thought of Dr. Bement's, 
as well, that in addition to some of the bio-fuels work and 
hydrogen work, there's also energy reduction work--how do you 
actually have more efficient lighting? How do you actually have 
better insulations to reduce the demand, as well as to increase 
the supply of alternative energies? These are all areas that, I 
know, all of the agencies mentioned under ACI are heavily 
involved in.
    Senator Thune. Well, I just don't think we can hardly do 
enough in that area. And I know that there have been estimates 
that there is enough wind generated in my State of South Dakota 
alone to meet the electricity needs of 10 percent of the people 
in the entire country. And so, we are obviously very interested 
in pursuing some of those things, but as I said, it's not a 
parochial issue, I think it's an issue that has a bearing on 
our energy independence, the energy needs that we have as a 
Nation, and the need for good, clean, renewable energy.
    Some people might argue there's probably enough wind in 
Washington, D.C. to meet the needs of 10 percent of the people. 
But, my point is, we have to stay ahead in that area, and we 
have so many reasons for doing it. I would appreciate your 
continued dialogue with us about some of the things that are 
going on in areas that I see, as great opportunities for our 
country in terms of renewable energy.
    Mr. Bement, I just--in your written testimony, you 
mentioned that National Science Foundation leads Federal 
agencies in funding research and education activities based on 
competitive merit review, with over 88 percent of it's research 
and education funding going to awards selected through a 
competitive merit-review process.
    We've seen this merit-review process in competition, up 
close, in South Dakota recently, there's a--as you know--an NSF 
selection process ongoing to develop a deep underground science 
and engineering laboratory. A decision on that particular 
project is due out very soon and as much as I'd like to, I 
won't lobby you for South Dakota's location----
    [Laughter.]
    Senator Thune. I respect very much the merit-based and 
peer-review process that you use and undertake for this project 
and for others.
    But, I did want to ask you a question about it, because you 
mention in your testimony that you want to continue to improve 
on the selection process in 2008, by enhancing transparency and 
uniformity to the merit-review process. And, I would just ask 
you what types of improvements you're considering, and how 
would those changes impact projects that are currently 
receiving funding, or already selected for future funding?
    Dr. Bement. I think with regard to transparency, it's a 
question of making sure that the community knows well what our 
criteria stand for in merit review, and that we have an ongoing 
dialogue so that they meet those requirements in their 
proposals. We put much of that information on the website, but 
we have to communicate it in many more ways so that there's a 
clearer understanding of what it takes to be successful.
    We also have what we call NSF days. As a matter of fact, 
when I leave this hearing, I'll be going down to Oak Ridge to 
meet with principal investigators from universities, as well as 
representatives from the private sector to provide outreach in 
how to be successful in working with the National Science 
Foundation through our merit-review process.
    With regard to consistency, we need to continue to work on 
consistency across the Foundation. Our program officers do have 
the responsibility of recommending awards. Program officers 
from different directorates have different viewpoints on what 
constitutes an outstanding or excellent merit review. We need 
to share those practices and that information across the 
Foundation so that we can lift the quality of our merit review 
generally.
    Senator Thune. I appreciate that response.
    And, Mr. Chairman, I thank my colleague from Arkansas for 
his forbearance, and I yield back my time.
    Senator Kerry. Thank you very much, Senator Thune.
    Senator Pryor?

                 STATEMENT OF HON. MARK PRYOR, 
                   U.S. SENATOR FROM ARKANSAS

    Senator Pryor. Thank you. Thank you, Mr. Chairman.
    If I may, Dr. Marburger, I'd like to start with you and 
talk about nanotechnology. I just have two or three quick 
questions for you on nanotechnology.
    I notice that Nobel Laureate Rick Smalley has talked about 
how nanotechnology could enable a sustainable world of clean 
energy, water, agriculture, et cetera. Do you see 
nanotechnology as an important part of the future when it comes 
to clean energy and the environment?
    Dr. Marburger. Yes, sir, Senator. Nanotechnology promises 
improvement of many materials and processes that are related to 
energy, not only on the energy conservation side, for example, 
in making chemical reactions and the production of chemical 
products, more efficient, but also in connection with 
increasing battery storage capacity, and other characteristics 
of fuel cell, primarily through the materials enhancements, and 
products that use less energy, and use it more efficiently.
    Senator Pryor. OK, great. Given that, do you think that 
Congress should direct more Federal agencies to focus their 
nanotechnology resources, if you will, to working on energy, 
water, et cetera, environmental issues? Or, do you think that, 
just allowing things to work the way they are now that the 
resources will find their way to the problems?
    Dr. Marburger. Nanotechnology is such a broad field that 
there are very many opportunities and it's difficult to see, 
sometimes, from which part of this field you will get the 
results. So, for example, people working on biomass, are 
working with molecular-level machinery, that may turn out--
serendipitously--to have an influence on some other 
application.
    So, when it comes to basic research, I favor letting the 
science community determine the direction and the course, I 
don't favor top-down direction. We try to avoid it ourselves, 
in the Executive Branch. This is one area that has such a broad 
impact that we want the scientific community to let us know.
    Senator Pryor. Great, that's helpful.
    There's something called the Nanotechnology Environmental 
and Health Implications Working Group, and as I understand it, 
I think that you may call it the NEHI Working Group, the NEHI 
Working Group is developing research strategy, with priorities, 
timelines, budgets, et cetera. When can we expect to have the 
benefit of that work product?
    Dr. Marburger. My understanding is that that's a high-
priority project, and I don't want to commit to a time, because 
I haven't asked them, specifically, where they are, but my 
understanding is that they're working aggressively on this, and 
I expect something, certainly, during this calendar year, and 
almost certainly well before that.
    Senator Pryor. OK, great.
    Dr. Bement, let me turn to you, if I may, in looking at the 
geography when it comes to R&D and EPSCoR, things like that, 
when looking at the map, the geography, I notice that there are 
clusters of research that are done on the East Coast, West 
Coast, Upper Midwest, but there are areas in the country that 
don't have much of that.
    Is geographical diversity--is that a worthy goal? In other 
words, do you think that good ideas really don't have any 
geographical boundaries, or do you think it makes sense to have 
them concentrated in certain clusters around the country?
    Dr. Bement. Absolutely, I agree with you, Senator. There 
seems to be a misconception that all of the talent in the world 
exists in a few, top research universities, but one has to keep 
in mind that the Ph.D. graduates from those universities go 
elsewhere in the country to teach, and many of them go to 
places in the United States where they want to be located, some 
want to go to smaller institutions, because they have more 
freedom and flexibility. So you'll find talent broadly 
distributed throughout the United States.
    And more to the point of your question, the National 
Science Foundation could not meet its obligations under the 
American Competitiveness Initiative without involving every 
state in the initiative.
    Senator Pryor. And I would welcome your thought on how we 
should have the EPSCoR Program and others to try to improve, 
you know, some sort of geographical diversity----
    Dr. Bement. Yes.
    Senator Pryor.--I don't know if you have thoughts today or 
if you just want to get back to us.
    Dr. Bement. Well, I do have thoughts today, I'd be glad to 
get back with you, and----
    Senator Pryor. That'd be great.
    Dr. Bement.--discuss it more broadly.
    Senator Pryor. I'd like to, because that is probably a 
longer discussion than we really have time for today, but I'd 
love to visit with you about it.
    The last thing I have is really a question that in some 
ways is off the subject, but I think is very relevant, and if I 
may, Dr. Jeffrey, I'll start with you since I haven't picked on 
you yet. The Congress, once again, will soon enter a discussion 
on immigration policy. Before this very distinguished panel 
leaves, I'd like to get each one of your thoughts on things 
that we need to be looking for when we are evaluating America's 
immigration policies and things we need to have in our minds as 
we listen to this debate. So, if you want to start, and if all 
three could answer.
    Dr. Jeffrey. Thank you very much. I believe that there are 
definitely aspects of the immigration policy that directly 
impact our ability as a Nation to remain competitive. And, when 
you look at the history of a lot of the science within this 
country, a lot of the Nobel Prize winners--many of these were 
immigrants coming into this country.
    One of the things for me to be able to do my job at NIST, 
as well as others, we try to bring in the best and the 
brightest from around the world. And, it would be great to be 
able to make that an easy access, and to then encourage 
retention of some of the best and the brightest talent within 
the United States, helping to support missions that are 
important to the U.S.
    And, so as the immigration debate goes forward, remembering 
the goals, also, of attracting and retaining the best and the 
brightest around the world, I think, is an incredibly important 
part of our competitiveness.
    Dr. Bement. Yes, with regard to collaborating with the very 
best scientists around the world, and tapping the best talent 
for a graduate education in this country, it's important that 
we keep the barriers low, not only for visas, but also for 
immigration. I think that expresses my point of view.
    Dr. Marburger. The President's American Competitiveness 
Initiative has a specific provision for improving the 
immigration environment for highly trained people in the 
technical areas that are important for our competitiveness.
    Senator Pryor. Thank you, Mr. Chairman.
    [The prepared statement of Senator Pryor follows:]

   Prepared Statement of Hon. Mark Pryor, U.S. Senator from Arkansas
    For the past half century, the United States investment in basic 
research has been the engine that drives our economy. In 1945, Vannevar 
Bush submitted his report Science--The Endless Frontier to President 
Franklin Delano Roosevelt that spurred the creation of a system of 
public support for university research that endures to this day.
    The connection between basic research and the economy is 
straightforward. Basic research produces the discoveries that through 
innovation and manufacturing become the products that transform and 
strengthen our economy.
    The goal of basic research is not to publish the most scientific 
papers, receive the most patents, or win awards. The goal is to 
discover new scientific ideas, principles, and theories. In a global 
economy, with instantaneous access to information, the United States 
runs the risk of other nations innovating faster that we do and ending 
up with the ``commercial fruits'' of our ``scientific labor.''
    I support the recommendations of the National Academies report 
Rising Above the Gathering Storm and I am a cosponsor of the America 
COMPETES Act. I hope that this legislation will begin to restore our 
science research infrastructure and competitive edge. At the same time, 
I am concerned about our ability to rapidly translate scientific 
discoveries through innovation into new commercial products and 
technologies.
    I thank the witnesses for joining us today and Senator Kerry for 
chairing this hearing.

    Senator Kerry. Thank you very much, Senator, I appreciate 
it.
    I'm a little pressed here because I have to get over to a 
Finance Committee meeting momentarily, but I want to try, if I 
can, to cover a couple of questions, and see where we are.
    Dr. Bement, in 2005, the National Research Council of the 
National Academy of Sciences issued America's Lab Report, 
Investigations into High School Science. And they found, ``the 
quality of current laboratory experience is poor for most 
students,'' and then ``A revision in lab activities would help 
students to better develop skills and cultivate an interest in 
science.'' It referred to the declining condition of schools, 
and their science facilities. Can you share with me what NSF's 
response has been to that report?
    Dr. Bement. We're very favorable to the report, and agree 
with all of the recommendations and findings in the report, and 
through our programs, we try to respond to that. Not only in 
trying to upgrade laboratories, but also to provide training to 
teachers, and how best to teach in the laboratory, to get the 
best benefit from the investment.
    Clearly, we can provide supplements to many of our grants 
that can go, not only to improving laboratories, but also 
explore where laboratories can be more cost-effective using 
modern technology, information technology for example.
    Senator Kerry. Do you have a specific, or is there a 
targeted program based on that, that's trying to really lift 
people's focus, and focus energies on it.
    Dr. Bement. I don't know that we have--we do have one 
targeted program, and that's the program we call ITEST, which 
is to bring information technology into the classroom. It meets 
many of the requirements that would also be necessary for 
effective use of laboratory resources, as well.
    But, I guess I would have to say, that's the only example I 
can think of.
    Senator Kerry. I've been in some of these schools, and I've 
had science teachers sort of point out to me, you know, 
``Senator, it's really hard to do what we're trying to do, this 
is not state-of-the-art,'' and so forth. And I think it's 
pretty tough to encourage kids around the country to be serious 
about science, and think we're serious, if these are the 
facilities that they're operating in. I think that your input 
on this can be particularly persuasive to our colleagues here 
in terms of expenditures and otherwise. I'd urge you to----
    Dr. Bement. Senator, it does also occur to me that we are 
working with the National Governor's Association in trying to 
deal with some of these issues, and most of our Math and 
Science Partnerships deal with this issue in partnership with 
the states. So, hopefully, as a partnership, we can begin to 
address many of these issues. It's certainly high on our 
agenda, it is something we discuss regularly with State 
officials, and I agree with you entirely, it's important.
    Senator Kerry. Thank you.
    Dr. Jeffrey, with respect to the Manufacturing Extension 
Program, everybody in the country knows what's happened to 
certain states, the manufacturing base, the jobs. During the 
period that the Bush Administration has repeatedly tried to cut 
it, we've actually used it to add or retain more than 12,000 
manufacturing jobs in Massachusetts alone.
    The Fiscal Year 2008 budget proposes very dramatic cuts to 
this program, from $104 million down to about $46 million. Why, 
given its benefits and contribution to competitiveness is it 
repeatedly under assault?
    Dr. Jeffrey. Well, thank you Senator.
    The program we view as an effective program, it's a 
question of priorities. As mentioned--one of the core 
priorities that we have is increasing the basic science 
research, which creates new industries, supports new 
industries--the Manufacturing Extension Partnership works at a 
company by company level, it does that effectively. We believe 
that the Federal Government, the role that we play in that, is 
really to help ensure that new skills are generated that can 
get propagated throughout the centers; that there's a quality 
control to ensure that the centers operate effectively; and 
that there is enough of a focus that is kept on a small 
manufacturing base, which is a critical component.
    We believe with the budget that was proposed, we can do 
that from the Federal Government. And then, it gets into the 
prioritization, where the other funds are necessary, where we 
believe there's greater leverage from the Federal investment in 
the basic science.
    Senator Kerry. Well, I understand your drawing that 
distinction. But, I think there's a fairly strong base of 
support here, and obviously each year we've had a different 
point of view in the Congress, bipartisanly.
    What about with respect to the Massachusetts program, there 
was a policy difference between NIST, you folks and the IG, has 
that been resolved, on the audit?
    Dr. Jeffrey. If you're referring to the 2003 audit----
    Senator Kerry. Right.
    Dr. Jeffrey.--that has been resolved, and Massachusetts MEP 
has been notified.
    Senator Kerry. We should be able to proceed forward with 
that?
    Dr. Jeffrey. Yes.
    Senator Kerry. Great. Well, I appreciate it. There are a 
few other questions, I want to leave the record open for a 
couple of weeks, just to follow up if any colleagues also have 
questions or weren't able to be here.
    We appreciate it, I know these are complicated budget 
times. I might just comment that there was a revision on the 
budget done by CBO which suggests that we will not, in fact, be 
in balance by 2012, just for the record so you're aware of 
that, we obviously have to operate within that. But, I hope 
that we can continue the cooperation which we've obviously 
appreciated. We do consider these entities that you represent 
among the most important in our Government, and really vital to 
our economic future. I know you know that, and as a committee 
we know that. We look forward to working with you, and we 
appreciate the job you're doing under obviously constrained 
circumstances.
    Thank you for being here today, we stand adjourned.
    Thank you.
    [Whereupon, at 11:40 a.m., the hearing was adjourned.]

                            A P P E N D I X

     Response to Written Question Submitted by Hon. Mark Pryor to 
                         Dr. William A. Jeffrey

    Question. It appears that NIST has been slow to market the user 
facility to industry. When will the user facility be available to 
outside users? Will NIST researchers help companies improve their 
nanoscale materials or merely provide a characterization service? Has 
NIST developed a standard agreement that clearly defines fees and 
intellectual property ownership?
    Answer. The Center for Nanoscale Science and Technology (CNST) 
exemplifies NIST's core mission to promote U.S. innovation and 
industrial competitiveness by advancing measurement science, standards, 
and technology in ways that enhance economic security and improve our 
quality of life, The CNST endeavors to provide science and industry 
with the necessary measurement methods, standards, and technology to 
facilitate the development and productive use of nanotechnology from 
discovery to production. In this way, we hope to drive innovation in 
nanotechnology and the related frontier areas of science and 
technology.
    To achieve this mission, the CNST contains the Nanofab, a state-of-
the-art facility that provides advanced nanofabrication and measurement 
instrumentation on a fee-based, shared use basis. It includes tools for 
patterning semiconductor and other materials via photolithographic, 
electron beam, ion beam, or nanoimprint lithographic methods as well 
optical, electron, and ion based measurement tools. It is located in 
both a 16,000 square foot clean room (which includes 8,000 square feet 
of class 100 space) and in an adjacent laboratory building (216) of 
NIST's Advanced Measurement Laboratory (AML) complex.
    The CNST Nanofab has recently opened to all users. It currently has 
in excess of 150 internal NIST users who are taking advantage of the 
state-of-the-art Nanofab on a fee-based, shared use basis. CNST staff 
is actively reaching out to potential external users to facilitate the 
growth in external use over the next year. The CNST staff has created a 
range of standard agreements that clearly define fees as well as issues 
related to intellectual property rights. Under at least one of the 
arrangements, external users may maintain sole ownership of their 
intellectual property rights.
    Finally, the CNST provides a flexible menu of services to the 
external research community, which can be leveraged to best meet their 
individual needs. As discussed above, external users can have access to 
the CNST Nanofab user facility on a fee-based shared use basis. This 
would include access to the Nanofab's technical staff that can assist 
the users in taking full advantage of the capabilities of the 
laboratory space and equipment. In addition, users can, if they choose, 
partner with CNST researchers in joint research teams, focused on areas 
of common interest related to improving nanostructures and devices.
                                 ______
                                 
     Response to Written Questions Submitted by Hon. Mark Pryor to 
                         Dr. John Marburger III

    Question 1. The United States competes with other countries for 
ideas, talent, and resources. Emerging economies are rapidly increasing 
their R&D investment. As a percentage of GDP, the U.S. Federal 
investment in physical sciences and engineering research has dropped by 
half since 1970. In 2005, the U.S. high technology industries employed 
5.6 million people. Starting in 2001 the U.S. has run a high-tech trade 
deficit that continues to widen.
    In many fields, what was once viewed as a linear process of 
innovation from basic research, through scale-up, to commercialization 
is now much more complex. Scientific discoveries reported in the 
literature or patents are instantaneously available around the globe. 
The U.S. needs to be more nimble and faster in translating these 
scientific ideas and discoveries into new products and technologies 
before our competitors do so. Do we have a good understanding of the 
innovation process and the barriers to innovation?
    Answer. There is a great deal of on-going research aimed at gaining 
a better understanding of the conditions that foster, drive and enable 
innovation. Despite some progress in describing the innovation process 
in limited areas, it remains a field of inquiry with a great deal of 
potential.

    Question 2. What implications would a better understanding of how 
innovation occurs have on science and technology policy?
    Answer. Innovation is a hallmark of successful research and 
development and a trait that should be fostered. If a solid, scientific 
basis for innovation could be established it would allow us to 
formulate science and technology policy with more focused goals and 
give us tools to better evaluate the outcomes.

    Question 3. What new models, pilot programs, or experiments for 
accelerating the innovation of high risk/high reward R&D would you 
suggest the Federal Government try?
    Answer. An important long term goal of the American Competitiveness 
Initiative is to foster innovation by ensuring that basic physical 
sciences are appropriately funded thereby increasing the chances that 
fundamental discoveries will fuel innovation. The decision to undertake 
specific programs and experiments is best left to agency leadership in 
consultation with scientists.

    Question 4. An important aspect of U.S. efforts to maintain and 
improve economic competitiveness is maintaining a capable scientific 
and technological workforce. Science and engineering occupations are 
projected to grow by 21 percent from 2004 to 2014, compared to a growth 
of 13 percent in all occupations during the same time period.
    The increased presence of foreign students in graduate science and 
engineering programs is a concern to some in the scientific community. 
Enrollment of U.S. citizens in graduate science and engineering 
programs has not kept pace with that of foreign students. Also, a 
significant number of university faculties in the scientific 
disciplines are foreign, and foreign doctorates are employed in large 
numbers by industry. Do you think the United States should be concerned 
that our universities are educating foreign students who then go back 
to their home countries and compete with the U.S.?
    Answer. The U.S. system of higher education, the best in the world, 
will continue to attract high quality students from around the world. 
Some of these students will stay in the U.S. after receiving their 
degree, some will return to their home country and some will seek 
opportunities elsewhere. The U.S. should make every effort to retain 
the best of these students while accepting the fact that many of them 
will not stay. Many of those who go elsewhere will use their American 
education to build better trading partners and allies for us.

    Question 5. Do you have recommendations for policy changes so that 
the United States can retain the best and brightest foreign students to 
work in America?
    Answer. The American Competitiveness Initiative recognizes the 
importance of retaining qualified foreign students with sections that 
focus on education, workforce training and immigration. These complex 
issues should continue to be addressed by Congress and the 
Administration.
                                 ______
                                 
Response to Written Question Submitted by Hon. Kay Bailey Hutchison to 
                         Dr. John Marburger III

    Question. Please provide a summary of the manner in which the 
National Aeronautics Research Policy established pursuant to P.L. 109-
155 contributes to and enhances the Nation's competitive posture 
through an emphasis on basic research.
    Answer. The National Aeronautics Research and Development Policy 
approved by President Bush on December 20, 2006 and effectuated by 
Executive Order 13419 ``National Aeronautics Research and 
Development'', provided the Nation with the overarching goal ``to 
advance U.S. technological leadership in aeronautics by fostering a 
vibrant and dynamic aeronautics R&D community that includes government, 
industry, and academia.'' The Policy will contribute to U.S. 
competitiveness by providing lasting, long-term policy guidance to the 
Federal Government's aeronautics R&D activities which will cultivate an 
R&D environment that enables a globally competitive U.S. aeronautics 
enterprise. Consistent with this, Executive Order 13419 states that 
``continued progress in aeronautics . . . is essential to America's 
economic success and the protection of America's security interests at 
home and around the globe.'' Hence, both the statutory Policy and 
Executive Order clearly recognize the link between the Nation's 
interests and the need for advancing--not merely maintaining--its 
technological leadership in aeronautics.
    The Policy's inclusion of basic research activities are captured 
primarily through its clarification of roles and responsibilities of 
the departments and agencies conducting aeronautics R&D in a section 
devoted to ``stable and long-term foundational research''. While 
foundational research does consist of basic research, it also 
encompasses many aspects of applied research that require continued 
long-term scientific study in order to advance a strong technology base 
in aeronautics that will not only benefit Federal departments and 
agencies, but also the Nation's broader aeronautics enterprise.
    Lastly, it should be noted that the Policy does not place an 
emphasis solely on foundational research. Of interest to the topic of 
the Nation's competitive posture, the Policy includes general 
guidelines for the interaction between the Federal Government and the 
commercial sector. The Policy also lays out guidelines to Federal 
departments and agencies for advanced aircraft systems development and 
air transportation management systems--key elements that will allow our 
Nation to maintain its mobility through the air that is vital to 
economic stability, growth, and security.
                                 ______
                                 
Response to Written Questions Submitted by Hon. Kay Bailey Hutchison to 
                        Dr. Arden L. Bement, Jr.

    Question 1. Please provide a detailed summary of actions taken by 
the Foundation which would increase its focus on basic research in 
response to the American Competitiveness Initiative.
    Answer. The American Competitiveness Initiative (ACI) sets out a 
bold challenge, calling for expanded Federal investment to drive 
innovation and sharpen the Nation's competitive edge. NSF's investments 
in research and education encompass all of the ACI's goals.
    For the 2007 Fiscal Year NSF has set priorities that will 
strengthen the science and engineering enterprise through investments 
in frontier research, the workforce, education, and cutting-edge 
research tools. Examples include:

   Cyberinfrastructure--Cyberinfrastructure is likely to be a 
        key factor determining research excellence for many years to 
        come. NSF has increased funding for cyberinfrastucture research 
        and will begin the acquisition of a leadership-class high 
        performance computing (HPC) system optimally configured to 
        enable an orderly progression toward petascale level science 
        and engineering computation and data processing. This 
        investment is critical to NSF's multi-year plan to provide and 
        support a world-class computing environment that will make the 
        most powerful HPC assets broadly available to the science and 
        engineering community.

   Sensors for the Detection of Explosives--NSF is investing in 
        fundamental research on new technologies for sensors and sensor 
        systems to improve the detection of explosives, including 
        Improvised Explosive Devises (IEDs). Related research will 
        target advances in the analysis, interpretation, and evaluation 
        of data gathered from sensors, as well as the integration of 
        this data with information available from a wide variety of 
        other fields and sensing systems.

   Advanced Materials--Fundamental research in advanced 
        materials underpins competitiveness across the spectrum of 
        technologies on which society depends, ranging from 
        communications and computers to medicine, energy, 
        transportation, civil infrastructure, security and national 
        defense. NSF's advanced materials investments include new 
        materials in electronics to reduce the need for internal 
        cooling fans, polymer gels to power tiny machines and sensors 
        to detect leaks from hydrogen-fueled vehicles.

    Fiscal Year 2008 priorities target investments in concrete 
scientific, engineering, and educational challenges of major 
significance to the Nation and the world. Rapid progress in these areas 
will generate new concepts and tools, with far-reaching applications, 
lay the foundation for next-generation tools and technologies, and 
develop educational strategies to engage students and prepare them to 
excel in a fast-changing, global environment. One targeted investment 
is Cyber-enabled Discovery and Innovation (CDI). This is a new NSF-wide 
investment to broaden the Nation's capability for innovation by 
developing a new generation of computationally based discovery concepts 
and tools to deal with complex, data-rich, and interacting systems. The 
rapidly emerging world of peta-scale computers, massive data flows, and 
databases pose exceptional challenges that require capabilities well 
beyond those available today. CDI aims to explore radically new 
concepts, approaches, and tools at the intersection of computational 
and physical or biological worlds to address such challenges. New means 
of computational discovery will augment the traditional discovery-
innovation loop with novel computational concepts to aid knowledge 
discovery, analysis, and experimentation. This will accelerate the 
discovery of knowledge buried in massive datasets, creation of models 
to understand complex phenomenon, and understanding of rare events.
    NSF's commitment to the ACI is further underscored in its Strategic 
Plan for FY 2006 to FY 2011, which outlines key steps and new 
investments at the forefront of discovery, learning, and innovation. 
The four strategic outcome goals established in the plan shape the 
overall investment strategy of the NSF:

   Discovery--Foster research that will advance the frontiers 
        of knowledge, emphasizing areas of greatest opportunity and 
        potential benefit and establishing the Nation as a global 
        leader in fundamental and transformational science and 
        engineering.

   Learning--Cultivate a world-class, broadly inclusive science 
        and engineering workforce, and expand the scientific literacy 
        of all citizens.

   Research Infrastructure--Build the Nation's research 
        capability through critical investments in advanced 
        instrumentation, facilities, cyberinfrastructure, and 
        experimental tools.

   Stewardship--Support excellence in science and engineering 
        research and education through a capable and responsive 
        organization.

    The plan charts an ambitious course for the future, stressing 
investment opportunities that promise to stimulate innovation, 
contribute to economic growth, and provide exceptional returns on 
America's investment in frontier research and education.

    Question 2. Has the NSF undertaken any effort to better focus its 
consideration of grants and awards toward addressing the Nation's 
challenges in the fields of science, technology, engineering and 
mathematics? Please provide details of those efforts.
    Answer. The cornerstone of NSF's organic act is ``to promote the 
progress of science, the national health, prosperity and welfare, and 
to secure the national defense.'' The NSF Strategic Plan for FY 2006-
2011 views this mission in the context of current challenges facing the 
Nation, and it specifically identifies investment priorities under the 
agency's four strategic goals: Discovery, Learning, Research 
Infrastructure, and Stewardship. These priorities are based on a range 
of inputs, including Congressional interests, Administration 
priorities, and interagency initiatives to address national needs. 
These are given further focus through NSB studies, community workshops, 
and NSF's budget formulation processes. Current research efforts 
address some of the Nation's most critical challenges such as 
nanotechnology, climate change, earthquakes, and hazard reduction.

    Question 3. I understand NSF has recently taken steps to enable 
unsolicited proposals for support of research aboard the International 
Space Station. Please provide details about this initiative.
    Answer. NSF is part of a task force of seven Federal agencies which 
has developed a strategy for using the International Space Station 
National Laboratory as a venue for further inspiring teachers and 
students in the areas of science, technology, engineering, and 
mathematics. The basic idea is that young people of the Nation in 
various settings will devise experiments, talk with astronauts, and 
monitor space station events that will inspire and educate them and 
their teachers across the country. The task force's education 
development concept looks at ways to use the Space Station's U.S. 
segment to support future projects and develop partnerships for 
education payloads, or experiments, with other Federal agencies.

    Question 4. The National Research Council recently, recommended 
that the Federal Government establish a program of Innovation 
Inducement Prizes similar to the DARPA autonomous vehicle grand 
challenge or the privately funded Ansari X-Prize. Earlier this year, 
the National Academy of Engineering awarded the $1 million Grainger 
Challenge Prize for Sustainability to Professor Hussam of George Mason 
University for an inexpensive, easy to-make system for filtering 
arsenic from well water.
    Designed properly, Innovation Inducement Prizes could be a new way 
to stimulate innovation on hard to solve societal and technological 
problems. Many universities and companies compete for these prizes and 
the overall body of knowledge grows. Do you think Innovation Inducement 
Prizes could be a useful experimental model to try as a pilot program 
to stimulate innovation on some very specific, hard to solve problems?
    Answer. Not for the NSF. In Fiscal Year (FY) 2006 NSF awarded a 
grant to the National Academy of Sciences (NAS) to study the concept of 
developing an NSF Innovation Inducement Prize. Discussions held by the 
NAS Board on Science, Technology, and Economic Policy and Global 
Affairs were completed in August 2006 with a resulting report published 
in January 2007.
    While the report was supportive of the concept of inducement prizes 
for applied research and areas of research that had a clear target, the 
report recognized the challenges of this type of effort to the NSF 
mission and traditions. NSF focuses its energies on supporting research 
frontiers of all types and thus supports those people who attack the 
frontiers of knowledge. Moreover, the report concluded that, ``the 
agency is seen as working primarily through the competitive award of 
grants to academic scientists and engineers for self-initiated 
proposals about how to advance basic knowledge of natural and social 
phenomena. It has limited experience in supporting innovations intended 
to solve societal problems and no experience in administering 
innovation prize contests.''
    While the NAS report attempted to list some possible candidates or 
targets for a prize, it also recognized the challenge to NSF to 
initiate the management of such an activity. Considering these issues 
and budgetary constraints, the NSF has elected not to pursue a prize 
program.

    Question 5. If not the NSF, what agencies would be best suited to 
sponsor and manage an Innovation Inducement Prize program?
    Answer. The agencies that might be suited to sponsor and manage an 
Innovation Inducement Prize program would be those in whose domain the 
specific applied research target area falls, such as defense, energy, 
or space.

    Question 6. The Rising Above the Gathering Storm report sounded the 
clarion call for the need to improve our graduation numbers in science, 
technology, engineering, and math (STEM) across all grade levels from 
kindergarten through graduate school. The United States has allowed our 
competitive advantage to erode by not supporting K through college STEM 
education. In 2003, U.S. tenth graders ranked 18th in mathematics and 
24th in science out of the 30 OECD countries. Only 17 percent of U.S. 
undergraduate student are studying science and engineering. The 
comparable numbers for China are 52 percent, South Korea 41 percent, 
and Taiwan 38 percent.
    The America COMPETES Act authorizes substantial increase in STEM 
funding at all levels of our education system. This funding must be 
applied wisely and strategically. Has the NSF analyzed the STEM 
initiatives in the America COMPETES Act and do you believe that these 
new and bolstered programs will result in more students going into 
science, engineering and math programs and a reversal in our worldwide 
rankings?
    Answer. NSF's programs in education emphasize the importance of 
recruiting and retaining U.S. students into STEM fields. In accordance 
with the recommendations from the recent report from the Academic 
Competitiveness Council, we are currently working to ensure our efforts 
in STEM education work in concert with similar programs in other 
agencies and also with those of state and local entities. Key to these 
efforts will be the development of critical evaluation tools so that 
programs can be assessed and effectiveness measured.

    Question 7. How do we get students interest in STEM? Do we need to 
change the curriculum or how we teach science and math? Are we creating 
enough scholarships, fellowships, and young faculty research grants to 
attract and retain the best and brightest students into these 
scientific fields?
    Answer. We believe that improving the curriculum and reaching 
students at an early age in order to encourage their interest in 
science, especially before middle school, is a promising strategy for 
attracting students to the STEM fields and increasing interest in STEM 
careers (Fadigan & Hammrich, 2004; National Research Council, 2007; 
Tai, Liu, Maltese, & Fan, 2006) There is evidence that a relationship 
exists between early engagement and the pursuit of careers in science 
(e.g,, Tai et al., 2006). Further, there is accumulating evidence that 
instructional materials focusing on experimental inquiry rather than 
stressing fact memorization can create and sustain interest in science 
and mathematics (see National Research Council, 2007).
References
    Fadigan, K.A. and P.L. Hammrich (2004). A longitudinal study of the 
educational and career trajectories of female participants of. an urban 
informal science education program. Journal of Research in Science 
Teaching 41(8): 835-860.
    National Research Council. (2007). Taking science to school: 
Learning and teaching science in grades K-8. Committee on Science 
Learning, Kindergarten Through Eighth Grade. Richard A. Duschl, Heidi 
A. Schweingruber, and Andrew W. Shouse, Editors. Board on Science 
Education, Center for Education. Division of Behavioral and Social 
Sciences and Education. Washington, DC: The National Academies Press.
    Tai, R.H., Liu, C.Q., Maltese, A.V., & Fan, X. (2006). Planning 
early for careers in science. Science, 312, 1143-1144.

                                  
