[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]


                    NANOTECHNOLOGY: UNDERSTANDING HOW 
                    SMALL SOLUTIONS DRIVE BIG INNOVATIONS

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

                                HEARING

                               BEFORE THE

           SUBCOMMITTEE ON COMMERCE, MANUFACTURING, AND TRADE

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             JULY 29, 2014

                               __________

                           Serial No. 113-169
                           
                           
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]                           


      Printed for the use of the Committee on Energy and Commerce

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                    COMMITTEE ON ENERGY AND COMMERCE

                          FRED UPTON, Michigan
                                 Chairman
RALPH M. HALL, Texas                 HENRY A. WAXMAN, California
JOE BARTON, Texas                      Ranking Member
  Chairman Emeritus                  JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky                 Chairman Emeritus
JOHN SHIMKUS, Illinois               FRANK PALLONE, Jr., New Jersey
JOSEPH R. PITTS, Pennsylvania        BOBBY L. RUSH, Illinois
GREG WALDEN, Oregon                  ANNA G. ESHOO, California
LEE TERRY, Nebraska                  ELIOT L. ENGEL, New York
MIKE ROGERS, Michigan                GENE GREEN, Texas
TIM MURPHY, Pennsylvania             DIANA DeGETTE, Colorado
MICHAEL C. BURGESS, Texas            LOIS CAPPS, California
MARSHA BLACKBURN, Tennessee          MICHAEL F. DOYLE, Pennsylvania
  Vice Chairman                      JANICE D. SCHAKOWSKY, Illinois
PHIL GINGREY, Georgia                JIM MATHESON, Utah
STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio                JOHN BARROW, Georgia
CATHY McMORRIS RODGERS, Washington   DORIS O. MATSUI, California
GREGG HARPER, Mississippi            DONNA M. CHRISTENSEN, Virgin 
LEONARD LANCE, New Jersey                Islands
BILL CASSIDY, Louisiana              KATHY CASTOR, Florida
BRETT GUTHRIE, Kentucky              JOHN P. SARBANES, Maryland
PETE OLSON, Texas                    JERRY McNERNEY, California
DAVID B. McKINLEY, West Virginia     BRUCE L. BRALEY, Iowa
CORY GARDNER, Colorado               PETER WELCH, Vermont
MIKE POMPEO, Kansas                  BEN RAY LUJAN, New Mexico
ADAM KINZINGER, Illinois             PAUL TONKO, New York
H. MORGAN GRIFFITH, Virginia         JOHN A. YARMUTH, Kentucky
GUS M. BILIRAKIS, Florida
BILL JOHNSON, Missouri
BILLY LONG, Missouri
RENEE L. ELLMERS, North Carolina

           Subcommittee on Commerce, Manufacturing, and Trade

                          LEE TERRY, Nebraska
                                 Chairman
                                     JANICE D. SCHAKOWSKY, Illinois
LEONARD LANCE, New Jersey              Ranking Member
  Vice Chairman                      JOHN P. SARBANES, Maryland
MARSHA BLACKBURN, Tennessee          JERRY McNERNEY, California
GREGG HARPER, Mississippi            PETER WELCH, Vermont
BRETT GUTHRIE, Kentucky              JOHN A. YARMUTH, Kentucky
PETE OLSON, Texas                    JOHN D. DINGELL, Michigan
DAVE B. McKINLEY, West Virginia      BOBBY L. RUSH, Illinois
MIKE POMPEO, Kansas                  JIM MATHESON, Utah
ADAM KINZINGER, Illinois             JOHN BARROW, Georgia
GUS M. BILIRAKIS, Florida            DONNA M. CHRISTENSEN, Virgin 
BILL JOHNSON, Missouri                   Islands
BILLY LONG, Missouri                 HENRY A. WAXMAN, California, ex 
JOE BARTON, Texas                        officio
FRED UPTON, Michigan, ex officio
  
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Lee Terry, a Representative in Congress from the State of 
  Nebraska, opening statement....................................     1
    Prepared statement...........................................     2
Hon. Janice D. Schakowsky, a Representative in Congress from the 
  State of Illinois, opening statement...........................     3
    Prepared statement...........................................     5
Hon. Henry A. Waxman, a Representative in Congress from the State 
  of California, prepared statement..............................    76

                               Witnesses

Christian Binek, Ph.D., Associate Professor, Physics and 
  Astronomy, University of Nebraska--Lincoln.....................     6
    Prepared statement...........................................     9
    Answers to submitted questions...............................    78
James M. Tour, Ph.D., T.T. and W.F. Chao Professor of Chemistry, 
  Professor of Computer Science, Materials Science and 
  Nanoengineering, Smalley Institute for Nanoscale Science and 
  Technology, Rice University....................................    20
    Prepared statement...........................................    22
    Answers to submitted questions \1\

Milan Mrksich, Ph.D., Henry Wade Rogers Professor of Biomedical 
  Engineering, Chemistry and Cell and Molecular Biology, 
  Northwestern University........................................    38
    Prepared statement...........................................    40
    Answers to submitted questions \2\

Jim Phillips, Chairman and CEO, Nanomech, Incorporated...........    46
    Prepared statement...........................................    49
    Answers to submitted questions \3\


----------
\1\ Mr. Tour did not respond to submitted questions for the 
  record.
\2\ Mr. Mrksich did not respond to submitted questions for the 
  record.
\3\ Mr. Phillips did not respond to submitted questions for the 
  record.

 
      NANOTECHNOLOGY: UNDERSTANDING HOW SMALL SOLUTIONS DRIVE BIG

                              ----------                              


                         TUESDAY, JULY 29, 2014

                  House of Representatives,
Subcommittee on Commerce, Manufacturing, and Trade,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:20 a.m., in 
room 2322 of the Rayburn House Office Building, Hon. Lee Terry 
(chairman of the subcommittee) presiding.
    Members present: Representatives Terry, Lance, Harper, 
Olson, Bilirakis, Johnson, Long, Schakowsky, Sarbanes, and 
Barrow.
    Staff present: Leighton Brown, Press Assistant; Graham 
Dufault, Policy Coordinator, Commerce, Manufacturing, and 
Trade; Melissa Froelich, Counsel, Commerce, Manufacturing, and 
Trade; Kirby Howard, Legislative Clerk; Paul Nagle, Chief 
Counsel, Commerce, Manufacturing, and Trade; Michelle Ash, 
Democratic Chief Counsel; Carol Kando, Democratic Counsel; and 
Will Wallace, Democratic Professional Staff Member.

   OPENING STATEMENT OF HON. LEE TERRY, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF NEBRASKA

    Mr. Terry. Welcome all to our rock and roll hearing that is 
in a series of hearings called Nation of Builders where we 
explore American technology and its impact on job creation and 
manufacturing. I want to thank all of you here today. Now I 
feel like I am giving a speech on the National Mall. So while 
they are trying to fix it, I will continue to talk and be the 
guinea pig.
    So just as electricity, telecommunications, and the 
combustion engine fundamentally altered American economics in 
the ``second industrial revolution,'' nanotechnology is poised 
to drive the next surge of economic growth across all sectors.
    Nanotechnology refers to the ability to manipulate matter 
between 1 and 100 billionths of a meter, an endeavor that is no 
small feat. Pun intended. This capability is helping solve long 
intractable problems. For example, as computers get smaller, 
the problem of heat generation becomes more and more severe, 
and nanotech could hold the solution.
    Currently, there are natural barriers to making 
transistors, semiconductors, and computers any smaller because 
the heat generated during use destroys the material if that 
material is below a certain size. The ability to harness the 
inertia of an electron could one day allow a computer to 
operate on its own recycled waste heat. This capability is 
called spintronics, and it would allow electronic computer 
parts to break through that size barrier.
    Dr. Binek, who is here from the University of Nebraska, 
probably off of the Big 10 media days in Chicago, will expand 
on the idea of spintronics and describe his excellent work in 
this area of nanotechnology.
    Advances in nanotech don't just mean we can make things 
smaller. It is the ability to harness matter at the nanometer 
level, which has applications across many industries. In 
medicine, nanotech research has revealed that advanced nerve 
regeneration and cancer detection, diagnosis, and treatment 
methods could be just around the corner. In manufacturing, 
nanotech research has allowed us simply to make better 
materials. For example, nanocomposites can be used to decrease 
the weight of the bumper on a car, while enhancing its 
resistance to dents and scratches. And with three teenage boys, 
that is appreciated. And wires used to transmit electricity 
made from carbon nanotubes could one day eliminate much of the 
electricity loss that occurs in transmission.
    Today we seek to learn more about what obstacles stand in 
the way of nanotech research, but also any barriers that exist 
between the research and development stage and full-scale 
commercialization.
    There is no question that the U.S. is a leader in nanotech 
researching, but as U.S. researchers make new discoveries and 
the applications are revealed, I am concerned that other 
countries are doing more to facilitate nanotech development 
than we are. Nanotech is a true science race between the 
nations, and we could be encouraging the transition from 
research breakthroughs to commercial development.
    I believe the U.S. should excel in this area. Historically 
we have a great track record on generating startups, which is 
fueled by our entrepreneurial spirit in this country. However, 
for the first time since the Census Bureau started measuring 
this statistic, more businesses are failing than starting in 
the United States. Four hundred thousand businesses are born 
annually nationwide, while 470,000 are failing. That is a 
disturbing statistic.
    Accordingly, I am curious as to whether, given this hostile 
business climate, there are regulatory obstacles to adoption of 
nanotechnology in the commercial context.
    As Dr. Binek notes in his testimony, Moore's Law tells us 
that the performance-to-cost ratio of computing power doubles 
every 18 months or so. I believe we ought to be careful not to 
slow down the progress described by ``Moore's Law'' with ``more 
laws.''
    Again, I thank our witnesses, and introductions will be 
right after the ranking member's opening statement. Yield to 
the ranking member, Jan Schakowsky, for her statement.
    [The prepared statement of Mr. Terry follows:]

                  Prepared statement of Hon. Lee Terry

    Thank you all for joining us today to discuss 
nanotechnology-a catalyst that I believe could play a leading 
role in the next wave of economic growth.
    Just as electricity, telecommunications and the combustion 
engine fundamentally altered American economics in the ``second 
industrial revolution,'' nanotechnology is poised to drive the 
next surge of economic growth across all sectors.
    Nanotechnology refers to the ability to manipulate matter 
between 1 and 100 billionths of a meter-an endeavor that is no 
small feat.
    This capability is helping solve long-intractable problems.
    For example, as computers get smaller, the problem of heat 
generation becomes more and more severe, and nanotech could 
hold the solution.
    Currently, there are natural barriers to making 
transistors, semiconductors and computers any smaller because 
the heat generated during use destroys the material if that 
material is below a certain size.
    The ability to harness the inertia of an electron could one 
day allow a computer to operate on its own recycled waste heat.
    This capability is called spintronics, and it would allow 
electronic computer parts to break through that size barrier.
    Dr. Binek, who is here from University of Nebraska, will 
expand on the idea of spintronics and describe his excellent 
work in this area of nanotechnology.
    Advances in nanotech doesn't just mean we can make things 
smaller-the ability to harness matter at the nanometer level 
has applications across many industries.
    In medicine, nanotech research has revealed that advanced 
nerve regeneration and cancer detection, diagnosis and 
treatment methods could be just around the corner.
    In manufacturing, nanotech research has allowed us simply 
to make better materials.
    For example, nanocomposites can be used to decrease the 
weight of the bumper on a car, while enhancing its resistance 
to dents and scratches.
    And wires used to transmit electricity made from carbon 
nanotubes could one day eliminate much of the electricity loss 
that occurs in transmission.
    Today, we seek to learn more about what obstacles stand in 
the way of nanotech research, but also any barriers that exist 
between the research and development stage and full-scale 
commercialization.
    There is no question that the U.S. is a leader in nanotech 
research.
    But as U.S. researchers make new discoveries and new 
applications are revealed, I am concerned that other countries 
are doing more to facilitate nanotech development than we are.
    Nanotech is a true science race between the nations, and we 
should be encouraging the transition from research 
breakthroughs to commercial development.
    I believe the U.S. should excel in this area. Historically, 
we have a great track record on generating startups, which is 
fueled by our entrepreneurial spirit.
    However, for the first time since the Census Bureau started 
measuring this statistic, more businesses are failing than 
starting in the United States-400,000 businesses are born 
annually nationwide, while 470,000 are failing.
    Accordingly, I am curious as to whether-given this hostile 
business climate-there are regulatory obstacles to adoption of 
nanotechnology in the commercial context.
    As Dr. Binek notes in his testimony, Moore's Law tells us 
that the performance-to-cost ratio of computing power doubles 
every 18 months or so.
    I believe we ought to be careful not to slow down the 
progress described by ``Moore's Law'' with ``more laws.''
    Again, I thank the witnesses for being here today and look 
forward to their testimony.

       OPENING STATEMENT OF HON. JANICE D. SCHAKOWSKY, A 
     REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS

    Ms. Schakowsky. Well, it looks like our macrotechnology 
might have been fixed. I am not sure. Is this working, this on 
here? OK.
    So I want to thank you, Chairman Terry, for holding this 
important hearing on the issue of nanotechnology. I look 
forward to hearing from each of our accomplished witnesses 
about this exciting field. I was about to ask you all for some 
help here. I figured maybe the scientists know.
    But I would like to take this opportunity to introduce one 
of the witnesses today. Dr. Milan Mrksich is a professor at my 
hometown school of Northwestern University and a leader in the 
field of nanotechnology. Dr. Mrksich has focused his research 
on biomedical advances that would not be possible without the 
development of nanotechnology. He has been involved in research 
that has made Chicago one of the premiere destinations around 
the world for nanotechnology, from research and development on 
Northwestern's campus to the commercialization at the nearby 
Illinois Science and Technology Park, and other sites. So I 
look forward to getting his valuable perspective on this.
    From real-time monitoring of critical infrastructure to 
water purification to more effective treatment of cancer, 
nanotechnology has the potential to solve some of the world's 
most important challenges. Few fields of scientific research 
have as much breadth or potential.
    That being said, nanotechnology's impact on public health 
and our environment is not yet well understood. Certain studies 
have indicated potential hazards. For example, titanium dioxide 
nanoparticles, which are used in sunscreen to block UV light 
can also kill microbes used to treat municipal water supplies. 
That is why we need to be careful to ensure that federal 
regulators responsible for public health and chemical exposure, 
from EPA to FDA to CPSC, coordinate efforts to better 
understand any possible toxicity of nano materials and protect 
the public from harmful impacts, while enabling their 
beneficial use.
    The United States recognized the promise of nanotechnology 
early on, and the National Nanotechnology Initiative has 
benefitted from nearly $20 billion in federal investment since 
2000. Other world leaders have followed suit, and more than $70 
billion in global investment in nanotechnology over the same 
period.
    The Federal Government must continue to play a lead role in 
supporting nano research and development. Last year, Congress 
appropriated $1.5 billion for nanotechnology, more than 10 
percent below the Administration's request, however. According 
to the GAO, some other nations may already have surpassed the 
U.S. in terms of public investment in nanotech, and we can be 
sure that those competitors will maintain significant 
investments in this promising field moving forward.
    Congress, I believe, should commit to adequate support of 
cutting edge research, and I hope all my colleagues will join 
in working to increase National Nanotechnology Initiative 
funding moving forward.
    We should focus on the areas of nanotech pipeline that are 
in the most need of additional support. There is a demonstrated 
lack of financing for nanotech as it moves from the development 
stage to the commercialization stage. I am concerned that 
without consistent and significant financial backing, the 
advancement of nano in this country could slow. We should work 
to ensure that promising technologies, especially those that 
can save and sustain human lives, have the support needed to 
reach and benefit the public.
    Again, I am very excited about the promise nanotechnology 
holds for our country and the world. I look forward to hearing 
the perspectives of our witnesses today, especially about where 
we go from here.
    I yield back my time.
    [The prepared statement of Ms. Schakowsky follows:]

            Prepared statement of Hon. Janice D. Schakowsky

    Thank you, Chairman Terry, for holding today's important 
hearing on the issue of nanotechnology. I look forward to 
hearing from each of our accomplished witnesses about this 
exciting field.
    I'd like to take this opportunity to introduce one of our 
witnesses, Dr. Milan Mrksich, a professor at my hometown 
Northwestern University and a leader in the field of 
nanotechnology. Dr. Mrksich has focused his research on 
biomedical advances that would not be possible without the 
development of nanotechnology. He has been involved in research 
that has made Chicago one of the premier destinations around 
the world for nanotechnology--from research and development on 
Northwestern's campus to the commercialization at the nearby 
Illinois Science and Technology Park and other sites. I look 
forward to gaining from his valuable perspective.
    From real-time monitoring of critical infrastructure to 
water purification to more effective treatment of cancer, 
nanotechnology has the potential to solve some of the world's 
most important challenges. Few fields of scientific research 
have as much breadth or potential.
    That being said, nanotechnology's impact on public health 
and our environment is not well-understood. Certain studies 
have indicated potential hazards. For example, titanium dioxide 
nanoparticles, which are used in sunscreen to block UV light, 
can also kill microbes used to treat municipal water supplies. 
That is why we need to be careful to ensure that federal 
regulators responsible for public health and chemical 
exposure--from the EPA to FDA and the CPSC--coordinate efforts 
to better understand any possible toxicity of nanomaterials and 
protect the public from harmful impacts while enabling their 
beneficial use.
    The United States recognized the promise of nanotechnology 
early on, and the National Nanotechnology Initiative has 
benefitted from nearly $20 billion in federal investment since 
2000. Other world leaders have followed suit, with more than 
$70 billion in total global investment in nanotechnology over 
the same period.
    The federal government must continue to play a lead role in 
supporting nanotechnology research and development. Last year, 
Congress appropriated $1.5 billion for nanotechnology, more 
than 10 percent below the Administration's request. According 
to the GAO, some other nations may have already surpassed the 
U.S. in terms of public investment in nanotech, and we can be 
sure that those competitors will maintain significant 
investment in this promising field moving forward. Congress 
should commit to adequate support of cutting edge research, and 
I hope all of my colleagues will join in working to increase 
National Nanotechnology Initiative funding moving forward.
    We should focus on the areas of the nanotech pipeline that 
are most in need of additional support. There is a demonstrated 
lack of financing for nanotechnology as it moves from the 
development stage to the commercialization stage. I am 
concerned that without consistent and significant financial 
backing, the advancement of nanotechnology in this country 
could slow. We should work to ensure that promising 
technologies--especially those that can save and sustain 
lives--have the support needed to reach and benefit the public.
    Again, I am excited about the promise nanotechnology holds 
for our country and the world. I look forward to hearing the 
perspectives of our witnesses today, especially about where we 
go from here. I yield back.

    Mr. Terry. Does anybody wish to make an opening statement 
on the Republican side?
    Mr. Olson. Mr. Chairman, introduction please, sir?
    Mr. Terry. Yes, I will do that right now then. So hold on.
    So our witnesses today, I want to thank all four of you for 
being here. We have three universities represented that are 
leaders in nanotech development and research, and I will just 
take a personal note and say we allowed one outside of the Big 
10.
    So I want to introduce from the University of Nebraska, 
Professor of Physics and Astronomy, Christian Binek. Then we 
also have Milan Mrksich from, a Henry Wade Rogers Professor of 
Biomedical Engineering, Chemistry and Cell and Molecular 
Biology at Northwestern University. Jim Phillips, Chairman and 
CEO of NanoMech, Incorporated. And now I yield for opening 
statement/introduction to the gentleman from Houston, Texas.
    Mr. Olson. Thank you, Mr. Chairman.
    As our guests can see by my nameplate, another Rice Owl is 
in the house this morning. That owl is James Tour.
    Dr. Tour and I share a common idol, the late Dr. Rick 
Smalley, who won a Nobel Prize in 1996 for his work in 
nanotechnology at Rice. Dr. Smalley changed my life by showing 
me that I had no future, none, in nanotechnology. After my 
first year of chemistry with him, that was pretty apparent. But 
he changed Dr. Tour's life by recruiting him to Rice to a 
leader in the Nanoscience and Technology Institute.
    Dr. Tour is a perfect witness to teach this committee about 
nanotechnology. He has created a thing called NanOKids, 
teaching kids K-12 about nanotechnology. If he can teach a 
fourth grader, man, he can surely teach members of Congress.
    So with that observation, Mr. Chairman, I yield back. Thank 
you.
    Mr. Terry. We can all hope.
    So have any of you testified before? A couple of you, good. 
For the two that haven't, this is an information hearing. It is 
not like a GM hearing where you have to raise your hand and get 
grilled. You are here to teach us. We want to hear what your 
work has been about, and we appreciate your testimony, which 
most of us have read.
    So we will start from my left to right. You have 5 minutes. 
There should be a clock up there if you want to look up. If you 
are still speaking about the 5-minute mark, I will just kind of 
lightly tap the gavel, which is the international symbol for 
wrap it up.
    So with that, I recognize the gentleman from the University 
of Nebraska, Dr. Binek.

  STATEMENTS OF CHRISTIAN BINEK, PH.D., ASSOCIATE PROFESSOR, 
 PHYSICS AND ASTRONOMY, UNIVERSITY OF NEBRASKA--LINCOLN; JAMES 
  M. TOUR, PH.D., T.T. AND W.F. CHAO PROFESSOR OF CHEMISTRY, 
     PROFESSOR OF COMPUTER SCIENCE, MATERIALS SCIENCE AND 
 NANOENGINEERING, SMALLEY INSTITUTE FOR NANOSCALE SCIENCE AND 
 TECHNOLOGY, RICE UNIVERSITY; MILAN MRKSICH, PH.D., HENRY WADE 
ROGERS PROFESSOR OF BIOMEDICAL ENGINEERING, CHEMISTRY AND CELL 
    AND MOLECULAR BIOLOGY, NORTHWESTERN UNIVERSITY; AND JIM 
       PHILLIPS, CHAIRMAN AND CEO, NANOMECH, INCORPORATED

                  STATEMENT OF CHRISTIAN BINEK

    Mr. Binek. Thank you, Mr. Chairman, for inviting me and 
having this opportunity to testify, and also, thank you, 
Congressmen and Congresswomen. So I am on faculty at the 
University of Nebraska in Lincoln and also an active nano 
scientist and I would like to give you a smooth start, let's 
say, into nanoscience and nanotechnology, so maybe we can start 
with the question, what is that all about?
    And starting by the prefix of the word nano, which actually 
comes from the Greek word nanos, and it means dwarf, so we deal 
with something very small, as we all know by now. But what we 
probably lack is an intuition for what it means, one billionths 
of a meter, so we need actually a proper ruler, so to say, to 
have comparison. And if we think of something small, we may 
think, for example, of the red blood cell in our bloodstream. 
But it turns out that is actually on the order of 6 microns in 
diameter. So a nanometer is 10,000 times smaller than that. Or 
maybe it is better to look at the molecular scale, and then we 
would identify a nanometer as being 5 atoms next to each other. 
So that gives us the scale, and that sets the stage for 
Feynman's celebrated remark, ``There's plenty of room at the 
bottom.'' And indeed, we can sort of say create and hope to 
create nanostructures from the bottom up, which are extremely 
small, much, much smaller, for example, than a cell, and have 
function and can, for example, travel in our bloodstream and 
monitor and maybe even increase health. So that was Feynman's 
vision of ``swallowing the doctor'' as he called it.
    From there I would like now to switch over and give us an 
idea of what is the special physics that happens at the 
nanoscale. What are those emerging properties at the nanoscale? 
And again, it is Feynman who asked the question, what happens 
if we can arrange atoms at will? And today, we are actually in 
a position where we can start to do that. We can image and 
manipulate atoms at will, and the answer is that if we can do 
that, then we can basically design material properties at will, 
because it turns out that all material properties, literally 
all of them, electric, magnetic, optic, thermal, mechanic, you 
name it, they all depend on the underlying atomic structure. So 
if you can arrange atoms at will on the nanoscale, then we can 
design within certain limits, for example, dictated by quantum 
mechanical loss, we can design materials properties.
    Now, that is not the end of the story. We can actually do 
more. An example for such a design for nanostructures would 
be--a simple but effective example would be nanoparticles 
specifically tailored in magnetic properties to be applied in 
magnetic hypothermia weight of potential cancer treatment.
    We can do more. We can bring different materials into close 
proximity. We have tools now, for example, multilayer--
techniques, and we bring materials A and B in proximity, which 
traditional chemistry doesn't allow us to do. And when that 
happens, new effects, new physical phenomena can emerge at the 
interface, and that sends the whole is indeed more as the parts 
A and B. Or as Herbert Kroemer said it already 40 years ago, 
today we can say the interface itself is the device. So from 
there, we can speculate and we can build a larger, more complex 
structures, nanostructures, and we have the tools to do that 
from the bottom up, like scanning macroscopy, or from top down.
    And with all that, we can look a little bit into the future 
and can see that nanotechnology will certainly transform 
information technology, medical applications, energy and water 
supply, smart materials, and manufacturing. And specifically in 
the information technology, there is a nonlinear trend going on 
now for 5 decades known as Moore's Law, where we can see that 
the performance to cost ratio is actually exponentially 
growing, so beyond our actual intuition. To give you an example 
of the hard drives of IBM from 1956 had less than 5 megabyte 
storage capacity, was two refrigerators big and weighed 2 tons. 
Fifty years later, we could make hard drives with 100 gigabytes 
capacity of storage and just the size of a deck of cards. That 
is 100 million fold improvement in that kind of performance to 
cost ratio.
    So the industry is well aware that Moore's Law is not 
necessarily a law of nature. It can and most likely seems right 
now to stop and to come to an end, and there are processes 
funded like spintronics, where I am involved, which allow us to 
tackle those problems and come to new types of electronics that 
we utilize the spin degree of freedom is just one example.
    So I am running out of time here. I would like just to 
conclude with an impact nanotechnology most likely has on 
society and economy. We need to recognize that nanotechnology 
is highly interdisciplinary and that there is a positive 
feedback which excels the progress. We have to prepare the 
workforce for this interdisciplinary and have to continue 
funding from the industry side and from the government side.
    With that, let me thank you for having me.
    [The prepared statement of Mr. Binek follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
           
    Mr. Terry. Thank you, Dr. Binek.
    Dr. Tour, you are now recognized for 5 minutes.

                   STATEMENT OF JAMES M. TOUR

    Mr. Tour. My name is James Tour, and I am the T.T. and W.F. 
Chao Professor of Chemistry, Professor of Material Science and 
Nanoengineering, and Professor of Computer Science at the 
Richard Smalley Institute for Nanoscale Science and Technology 
at Rice University in Houston, Texas.
    Rice's home is the home of nanotechnology where carbon 60 
was discovered. I have over 500 research publications and 70 
patents in nanotechnology in the fields of nanomedicine for 
treatment of traumatic brain injuries, stroke, and autoimmune 
diseases, nanomaterials including graphene and carbon nanotubes 
for electronics, optics, and composites, and high surface area 
nanomaterials for environmental capture of carbon dioxide and 
for water purification. All of these technologies are licensed 
to companies from my laboratory at Rice University, and all are 
transitioning from basic research to deployment in the U.S. and 
abroad.
    It is possible for Congress to directly improve the 
research enterprise in U.S. universities and to mitigate the 
current brain drain of our best and brightest scientists and 
engineers. This can be done without commitment of any new 
spending.
    Among the most ingenious pieces of legislation in my view 
was the Bayh-Dole Act dealing with intellectual property 
arising from Federal Government funded research. Prior to the 
enactment of the Bayh-Dole Act, the U.S. Government had 
accumulated 28,000 patents, but fewer than 5 percent of those 
patents were commercially licensed. The key change made by 
Bayh-Dole was ownership of the inventions that were made by 
federal funding. Bayh-Dole permits a university, small 
business, or nonprofit institution to elect to pursue ownership 
of an invention in preference to the government. Government got 
out of the way, and this spawned enormous entrepreneurial 
endeavors and led to startup companies and jobs being birthed 
throughout the country. And most interestingly, the legislation 
required no new allocation of funds.
    Unfortunately, there has been a dramatic loss of research 
funding to U.S. universities on a per-investigator basis over 
the past 5 years. The situation has become untenable. Not only 
are our best and brightest international students returning to 
their home countries upon graduation, taking our advanced 
technology expertise with them, but our top professors are 
moving abroad in order to keep their programs funded. The 
trolling by foreign universities upon top U.S. faculty has 
become rampant due to the declination of U.S. funding levels on 
a per faculty member basis. The brain drain is not something 
that we can recover. The impact of what has already been lost 
will last decades.
    I am not here to present to you an apocalyptic scene and 
then cry for money to slow the problem. I realize the cupboards 
in Washington are bare, and I offer you a no new spending 
solution. I have a large research laboratory, 30 graduate 
students and post-docs working busily to make new 
nanotechnology discoveries and translate those into exploitable 
applications. In 2008, my program was 90 percent federally 
supported and 10 percent industrially supported. Then for the 
first time in my 26-year career as a faculty researcher, I 
could no longer survive. One federal grant after another was 
unfunded. So I started to appeal to industries, showing them 
how our nanotechnology research could solve technical problems 
in their industries. Presently for company funds research at an 
academic institution through a sponsored research agreement, 
thereby guaranteeing the company access to research reports and 
their setting of milestones, then the company loses the 
benefits of a significant tax deduction of their allocation of 
funds. In other words, their allocation to sponsored research 
no longer has the same tax deductible benefits as a non-
researched based gift would have afforded them.
    I am asking Congress to consider legislation that would 
incentivize industry to fund academic research universities and 
nonprofits by granting the companies with a total or 
significant tax deduction for such university research 
investments. This permits companies to take up the slack where 
the Federal Government has been unable to maintain the research 
enterprise. Help me and my colleagues to raise our own research 
funds through partnerships with corporations. If I can explain 
to industries that there will be a complete or significant tax 
deduction for the sponsored research agreement, then I can sell 
my research to them with the utmost attractiveness.
    Let me close with this. King Solomon wrote in Proverbs 
25:11, ``Like apples of gold, in settings of silver, is a 
ruling rightly given.'' I pray your kind consideration for new 
Bayh-Dole-like ingenious legislation to be enacted, nullifying 
the dire conditions facing the U.S. research enterprise and 
loss of our U.S. trained scientists and engineers. This 
legislation would require no new federal allocations, and it 
can become part of the holistic approach to funding of academic 
science.
    Thank you.
    [The prepared statement of Mr. Tour follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
            
    Mr. Terry. Thank you. Dr. Mrksich, you are now recognized 
for your 5 minutes.

                   STATEMENT OF MILAN MRKSICH

    Mr. Mrksich. There it is. The last name is not easy. My 
mother-in-law struggled with it for many years.
    But I am currently the Henry Wade Rogers professor at 
Northwestern University with appointments in chemistry, 
biomedical engineering, and cell biology. I direct a research 
lab that develops nanomaterials for applications in drug 
discovery and diagnostics, and medical devices. I have also 
been involved in the translation of university-based science 
into companies, having co-founded SAMDI Tech, 480 Biomedical, a 
stent company, and Arsenal Medical. I am glad to be here to 
share some of my perspectives.
    As you have heard, the nanotechnology field has been 
enabled by the development of methods that can create materials 
with dimensions that are tiny, thousands of times smaller than 
the width of a hair. And we now know that the properties of a 
material that can vary strongly on their dimensions, and we 
have the ability to tailor-make materials with novel and 
important properties. This is a broad-based field. Unlike 
traditional disciplines, it cuts across the entire science and 
engineering enterprise, and has really led to paradigm shifting 
technology across the board.
    The National Nanotechnology Initiative recognizes 
transformative potential and required federal agencies across 
the board to invest in nano. And that really was important to 
creating a national strength and infrastructure in this new and 
exciting area.
    At Northwestern, we started the International Institute for 
Nanotechnology, now one of the largest such centers. This 
partners with departments across campus and to date, has raised 
over $600 million in research funding to develop this next 
generation of technology. It has also trained hundreds of 
students, many of which are now faculty members across the 
globe in this area.
    This investment has already led to a nascent but growing 
and important industry. Again, at Northwestern, our institute 
has seen about 25 companies get started, and those have raised 
greater than $700 million in research support to commercialize 
their products. And these success stories aren't unique, of 
course, to Illinois. They are found across our Nation.
    At the same time, there is a wide recognition that a lack 
of predefined regulatory processes can still present challenges 
to the commercialization of nanotechnologies. While regulations 
for safety and environmental impact are important, they should 
be effective at providing for the public's concerns and safety, 
but they need to be tailored to different classes of materials 
used in different sectors, and they need to be defined to 
remove the risk of uncertainty that product developers face 
when taking on these initiatives.
    Similarly, the manufacturing methods and standards that 
will be important to all companies in this space are still not 
well-developed. We don't have the standard tools we can rely on 
to produce in volume products based on nanomaterials, and this 
is an area where a public/private partnership based perhaps on 
the National Network for Manufacturing Innovation Centers could 
be quite effective at providing the entire industry with 
engineering practices that will enable the growth of this area.
    I would like to add comments to the theme of globalization 
that we have heard. The scientific and economic promise of 
nanotechnology has certainly been recognized by our foreign 
partners and competitors, and recent trends in those regions 
point to challenges that the United States has not faced 
before. First, governments in Europe and Asia continue to make 
targeted investments in nanotechnology, with annual growth 
rates that are in the double digits, and approaching 50 percent 
in China. Second, the culture and infrastructure has changed in 
Europe and Asia, and unlike 10 and 15 years ago, researchers 
there are quite effective at starting new companies. And 
finally, as you have heard, we are seeing the recruitment of 
our best scientists to full-time and part-time positions in 
other countries. And the globalization has certainly had and 
will have many benefits, but it will also level the global 
playing field for translating basic research into commercial 
entities, and it will dilute the positive impact of 
nanotechnology on our own economy.
    We must act now to ensure that our early investment and the 
very substantial impact it is positioned to deliver can be 
realized. We must renew our support for fundamental research in 
the nanosciences, as this will retain and continue to attract 
the best researchers to the United States, and keep our 
development pipeline full. We must remove barriers that make it 
challenging to start new companies that are in the early stages 
of product development. We must develop effective regulatory 
standards, but also clearer standards that remove the risk of 
uncertainty that many companies face in product development. 
And we must make the patent system more efficient, and remove 
the five or more year delay it can take to realize patent 
protection and keep out would-be competitors. We must engage 
our partners in industry, academia, and the government to 
create a manufacturing toolbox and kit that is universal, and 
again, serves the entire field.
    I thank you for your time, your attention, your service to 
our country, and I am happy to answer any questions that you 
may have.
    [The prepared statement of Mr. Mrksich follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
       
    Mr. Terry. Thank you.
    Mr. Phillips, you are now recognized for your 5 minutes.

                   STATEMENT OF JIM PHILLIPS

    Mr. Phillips. As a manufacturer of nanotechnology it is a 
great time to be alive. With the inventions of the chip and the 
software storage and the internet, more will be invented in the 
next 10 years than in the history of mankind, and no more place 
than nanotechnology will achieve these great new inventions and 
competitiveness that America is going to depend on, especially 
in manufacturing, where we see manufacturing drop as part of 
our GDP from about 79 percent to 17, 18 percent, giving us a 
distinctive competitive disadvantage on a global basis.
    I am proud to be chairman and CEO of NanoMech. We are based 
in northwest Arkansas, down the street from the likes of 
Walmart, Tyson headquarters, and we have, over the last year, 
won a portfolio of award-winning inventions and commercial 
products, including innovations in machining and advanced 
manufacturing, lubrication and energy, biomedical implant 
coatings, and very strategic military applications. We feel we 
are poised for dramatic expansion of our manufacturing 
operations. I am proud to say we are in the process right now 
of adding an additional 25,000 square feet to our existing 
factory. We have bought up the entire technology park that we 
live in with the belief that we will be needing that kind of 
manufacturing capacity to keep up with our demand.
    Today, the United States is locked in a moon race, in an 
absolute moon race with other major countries trying to take 
the lead in materials science and bio nanoscale engineering 
research, development, commercialization in what is sure to be 
the next industrial revolution of progress. While these 
competitive countries lost out to an extent to the U.S. in the 
information technology revolution, they are determined to put 
enormous amounts of public and private capital to work to win 
this more important race. Given the monopolistic efforts of 
China alone to control all of the world's dwindling resources. 
Today they control about 85 percent, the U.S. is now at great 
risk of not having the materials and the rare earth metals that 
are core to the most important manufactured goods that are 
essential to our daily lives. Nanoscale engineering is our 
greatest hope in providing a way to do more with less and 
amazing and sustainable ways to keep America secure, and the 
world leader in commerce, technology, and especially defense. 
Speaking of defense, it is clear by now that the country with 
the best UAVs wins. And no weaponization area more than UAVs 
will benefit from the tremendous advantages of nanoengineering 
and manufacturing. This, of course, is not to mention the huge 
gains already realized in defense and national security and 
weapons systems deploying quantum leaps in super-advanced 
nanoengineered coatings, lubricants, fuels, energetics, faster 
processors, and battlefield gear, all due to nanotechnology.
    Over the past 2 years, I have had the opportunity to 
participate in the Council on Competitiveness executive 
committee, as well as its U.S. Manufacturing Competitiveness 
Initiative, and the Office of the Comptroller General's Study 
on Nanotechnology. I take this opportunity to offer my 
perspective as an entrepreneur and a nano-manufacturer.
    Many U.S. States and localities do too little to attract 
manufacturing facilities, imposing complicated time-consuming 
procedures on top of federal rules to site and build production 
facilities. The permitting process for a manufacturing facility 
in the United States might take months, if not years, where in 
some countries the time required is merely a few weeks or less. 
We are certainly offered by China and Russia it seems like on a 
quarterly basis to move our entire operation there. Never will 
do it. Former ex-pilot in the Air Force and definitely a 
patriot, and we just won't do those kinds of things. We don't 
even take their money, even though they offer it to us all the 
time. Consider, for example, NanoMech, though, as our very safe 
product platforms. I don't know of any nanotechnology lawsuits 
for liability in the 30-year history of nanotechnology to date. 
We utilize convergent assembly so that we can nanoengineer 
tremendous improvements in many products and through this 
process, what we ship, even though nanoengineered and 
nanomanufactured, is no longer at nanoscale, but vastly 
superior to conventionally manufactured products. We are 
developing cutting edge technology that enables dramatically 
more efficient industrial processes, and therefore can save 
billions of dollars across several industries, while 
dramatically increasing performance.
    At the nanoscale, we and other manufacturers can reduce or 
eliminate harsh chemicals and materials and replace them with 
more environmentally sound and sustainable components. We do 
that every day. One of our products is called nGlide. This is a 
new super additive for the energy space. For that reason, we 
have opened up in Texas and are working with some of the 
largest companies in the energy manufacturing space. We add 
just a small amount of lubricant, and we reduce the coefficient 
of friction down to literally zero. Hardly any wear for that 
product going forward. We work with the largest companies 
around the United States in this. We also work with racing 
teams where this has all been demonstrated. Think of it, no 
wear, yet higher performance. The ability to increase miles per 
gallon, miles per hour, reduce heat, reduce wear.
    One of the other products we have is called TuffTek. This 
is where we spray a nano spray in a very safe facility with 
cubic boron nitride, the hardest substance known to man. When 
we do that, it creates a very hard coating surface on cutting 
tools. When we do that, cutting tools can last as much as 10 
times longer. Of course, cutting tools are at the core of 
everything that is manufactured. This year, we were awarded the 
R&D100, the Edison, and the Tibbetts Award for that, the 
Tibbetts Award coming through the EPA.
    Talent is perhaps the most important driver for 
manufacturing competitiveness, especially nanotechnology. The 
United States needs highly skilled workers to realize the 
productivity gains essential to remain globally competitive in 
the digital and nano age. Yet current and anticipated human 
capital deficiencies exist across the board. Not only are 
current openings for highly skilled workers challenging, 
manufacturing workers are retiring at a much higher rate than 
they are being replaced. For that reason, we ask this committee 
to consider taking a real hard look at the area of visas. Visas 
have turned out to be a huge problem for us as we try to man 
and staff our company with the very best and brightest.
    At this point in time, it looks like time is up so I will 
defer to questions.
    [The prepared statement of Mr. Phillips follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]     
    
    Mr. Terry. Thank you.
    Mr. Phillips. Thank you.
    Mr. Terry. So all witnesses have testified. This is our 
opportunity to begin our questions for you, and so as chairman, 
I get to start, and I will start with Dr. Binek.
    Now in your testimony, Doctor, you mentioned the 
interdisciplinary field. Could you expand on how you and the 
University of Nebraska are engaged in interdisciplinary 
practice, and who is part of that and how it enhances the 
ability to advance nanotechnologies?
    Mr. Binek. Yes, thank you, chairman, for that question.
    Let me first start locally, at the University of Nebraska, 
we have Nebraska Center for Materials and Nanoscience, which is 
an interdisciplinary center where we work together as 
physicists, chemists, and engineers on nanotechnological 
problems that includes building where all the tools and for 
electro-microscopy to x-ray machines to lithography, all housed 
in our actually quite new Walt A. Keaton building. And in 
addition, we are fortunate to have an NSF-funded MRSEC, 
Materials Research Science and Engineering Center, and in the 
same spirit interdisciplinary, we have physicists, we have 
chemists, and engineers all coming together and working on 
nanotechnological problems.
    I am also involved in two centers. One center is located 
also at the University of Nebraska, led by us. It is the Center 
for Nanophotonic Devices. It is an interdisciplinary research 
between six universities. And another center I am involved in 
is the C-Spin Center, where 18 universities nationwide----
    Mr. Terry. That is C-Spin, and what is that?
    Mr. Binek. It is a lengthy acronym for a center where we, 
again, look for spintronic solutions, mainly to sort of say the 
barrier which is anticipated by extrapolations of scaling. It 
is known in the semiconductor industry it is known that if you 
continue the scaling, making things just smaller and smaller, 
we will hit a barrier latest by 2020, which is determined by 
many reasons and also fundamental reasons, like quantum 
tunneling. We are asked to look for solutions to solve those 
heat problems you mentioned in your introduction, and 
spintronics is one of those potential solutions where you use 
the spin degree of freedom and we can have new functions in our 
devices, not only processing, but also processing and memory in 
one device. The spin or the collective phenomenon of magnetism 
is ideal for non-volatile memory, and we can switch those state 
variables also by electric means, avoiding electric currents, 
and that seems to be one way in the future to solve that 
problem.
    Mr. Terry. And as I understand, there are industries that 
are also involved, and so how do they participate? Talent, 
money, whatever.
    Mr. Binek. They participate on various levels, mainly 
money, and that is a good thing. So for example, the C-Spin 
center, if I am not mistaken, we talk about a volume of $31 
million of funding for a 6-year period. It is mainly by the 
Semiconductor Research Corporation, which is a consortium of 
who is who in the semiconductor industry from IBM, Intel, 
Global Foundries, Micron, you name it. And in addition, with 
the contribution.
    Mr. Terry. Thank you.
    Mr. Phillips?
    Mr. Phillips. Yes, sir.
    Mr. Terry. You take that nanotechnology and then apply it 
in manufacturing. I am interested about how you make that shift 
and the capital that is necessary to get that done. How do you 
do it?
    Mr. Phillips. Well, it is pretty conventional, the way 
American businesses always run. You have got to raise capital 
to build anything, whether it is a space shuttle or a Dairy 
Queen. You have to be able to capitalize it, and sometimes it 
comes from purely private capital, in my case, my capital as 
well. And then sometimes you are also able to get grants, both 
on a state and federal level, and those are very important. So 
we have received over time grants from National Science 
Foundation, the Office of Naval Research, Department of Energy, 
and so forth. Although very minimal compared to the totality of 
capital we have raised.
    When you build a company like this, the first thing you 
have to do is have the incredible ideation and invention, the 
concept and everything, and then you have to turn that into 
something that is manufacturable. You have to be able to create 
assembly lines that have quality control with repeatability, 
scalability, so that it prices out whatever it is you are 
manufacturing, that it becomes a must-have that people can 
afford. So it is basic business practices. In this technology 
which is very, very new, there are more regulatory probably 
than conventional. We know in the U.S., we appreciate the 
regulatory. We believe in safety and the controls that are in 
place, albeit we have to compete against countries that 
perhaps--have 5 percent total regulatory costs against our 30 
to 35 percent regulatory cost. So we have to build in an effort 
to accommodate that.
    Mr. Terry. Thank you, and my time is expired.
    I recognize the ranking member, Jan Schakowsky, for your 5 
minutes.
    Ms. Schakowsky. Instructor Tour, I appreciate all of the 
commercialization, especially that and the problems that you 
face because companies seem, you are saying would want these 
tax breaks. But I want to just make the very clear point that 
you say without any new federal dollars. Not true. It is a 
decision on whether there is direct federal subsidies and 
grants, or we give tax breaks. There is a reason that we talk 
about tax breaks as tax expenditures, because clearly, that is 
a cost to the Federal Government as well, any tax dollars that 
would be lost because we would, and so there is a lot of other 
considerations. Is it better for the Federal Government to make 
some of the decisions about where the money goes? Do we just 
leave it to the private sector? And I know others have 
mentioned public/private partnerships as another way to go.
    So I just wanted to make the point that this is not a 
freebie for the Federal Government when we say that we do it 
through tax breaks that we would give to corporations. Not 
ruling that out, but it is a tradeoff that we have to discuss.
    I wanted to ask Dr.----
    Mr. Tour. May I comment on that?
    Ms. Schakowsky. Yes, of course.
    Mr. Tour. I think that I said no new spending and no new 
allocations, because I well appreciate what you are saying, 
Congresswoman. It is a reality that when you don't have taxes, 
you don't have money coming in. So that is why I used the words 
that no new spending, no new allocations.
    But the other thing that I hope that I underscored is that 
it is really a dire situation in the federal dollars that are 
able to come in and by doing this, somehow we are spreading the 
load out a little bit to incentivize industry coming in.
    Ms. Schakowsky. I am all for that and it is not a 
criticism. I just wanted to make sure that we are clear that 
one way or another, it is money from the Federal Government.
    I just have a suggestion, Dr. Mrksich. If you added another 
vowel between the M and the R, if you added an E, everyone 
could pronounce your name.
    Mr. Mrksich. You should see my mailbox. I have about 10 
good versions of improvements on my name.
    Ms. Schakowsky. Just an idea. Four vowels, four consonants 
in a row makes it hard. OK. I don't want to take up too much of 
my time.
    I know that you primarily focus on nanomaterials for 
biological and medical applications, and I am wondering if you 
could provide a little more detail on the research that you are 
doing. What kind of advances might happen over the next 5 to 10 
years due to your research?
    Mr. Mrksich. I would be happy to. In the area of 
therapeutics, one kind of a very special properties that 
nanomaterials give us is the ability to target tissues more 
selectively. So a lot of drugs that are intended to act in the 
brain, whether it is for Alzheimer's Disease, those drugs are 
being developed, Parkinson's and others, those drugs have a 
difficult time crossing the blood brain barrier. So they can be 
taken, they are in the system, but they don't get to the site 
where they can act and improve health.
    We have now found that nanoparticles, because of their 
small sizes, but larger than molecules so they avoid some of 
the systems that molecules get tied up in, are much more 
effective at crossing that barrier. So this could be a platform 
to deliver medicines to the site where they can act so that 
when we have a medication, a pharmaceutical that is not useful 
because it doesn't get to the site, one can literally have to 
drill through the skull and put a device in the brain, or one 
might be able to use nanoparticle carriers to get them there. 
We still haven't worked through all of the safety issues and 
what the dosing should be, what the properties of those 
particles--but that is one example where nano would take 
existing trends and just put them at a different--on a 
different plane.
    Ms. Schakowsky. I was going to ask you about the support 
gap, but I think we have really heard from everybody that one 
way or another, the United States needs to figure out how we 
support this industry, and I just want to make sure that that 
has absolutely been heard.
    In your testimony, Dr. Mrksich, you mentioned the multi-
agency structure of the National Nanotechnology Institute, but 
I don't know if you know that Congress has not reauthorized 
that or provided an updated vision for it since 2003. I am 
wondering if there are any particular changes you think need to 
be made in order for it to get new life.
    Mr. Mrksich. Absolutely. The NNI, started in 2000, has 
absolutely been a success in terms of creating an 
infrastructure in the U.S., making the U.S. the global leader 
in innovating, and having the opportunities to translate into 
commercial entities. The NNI never had its own money. It 
required the agencies to redirect a fraction of their budgets 
to nano-related research. I think we are at the point where we 
have got this incredible infrastructure and we are now 
beginning, just in the last 3, 4, 5 years seeing a reverse 
brain drain. Our best people leaving and other folks who would 
have come to the United States staying. And this is a direct 
reflection of the imbalance of research money and 
infrastructure that is available.
    So there is no question in my mind that in renewing, it is 
really reinventing the NNI to put real money behind it and to 
ensure that our best people have the tools, have the funding to 
continue on this incredible first 15-year history we have 
created.
    Ms. Schakowsky. So for me, lesson learned. Private and 
public money is really needed to keep us in the forefront. 
Thank you.
    Mr. Terry. Recognize, I will not recognize the gentleman 
from Kentucky. Mr. Olson, you are recognized.
    Mr. Olson. I thank the chair, and my questions, first off, 
will be for Dr. Tour.
    Doctor, you mentioned in your testimony you have 30 grad 
students and undergrads, doctors, and post grads working for 
you at Rice. You mentioned concern about the brain drain, 
because many of these people come from overseas. How many 
people of that 30 are not from here in America? Half, two-
thirds?
    Mr. Tour. Of that 30, probably 25 are not Americans.
    Mr. Olson. How many people find a way to stay here after 
they graduate? You give them that great diploma, that 
sheepskin?
    Mr. Tour. I would say that half of them will stay. More 
would stay if they could. The very best of the international 
students are returning to their home countries where they can 
get faculty positions. There are no opportunities for them 
here. There are very few faculty positions opening up in the 
United States because of the funding situation, and that 
funding situation being a lack of money that is coming in in 
federal grants, and mechanisms for that. So they are getting 
very attractive offers from their home countries, or from 
countries like Singapore, and also, interestingly enough, the 
U.K. and Europe because of the large amounts of money in the 
area, specifically in carbon nanotechnology graphene. So many 
of them are leaving that would have liked to have stayed.
    Mr. Olson. And Doctor, you said in your testimony that 
corporations get a deduction if they fund research through your 
institute. Any example of a corporation that has lost their 
deduction, that has not invested in your institute because they 
lost a tax credit, tax, whatever you want to say about the tax 
preference. Any example of somebody who said listen, Doctor, I 
want to help you out but I just can't do it. I have to have 
that----
    Mr. Tour. Oh, there are companies that have said that they 
just can't swing this, but they are the companies that have 
come forward are doing it anyway, but it is very hard to get 
companies to step forward, and if I can use this as a 
leveraging point, it actually works out quite well for both of 
us. And as to the amount of deduction that they presently get, 
it is very hard even to figure that out. I am not a tax person 
and I tried to get that data even to bring it in here to speak 
to these companies how much they say definitely that it would 
help if we had had that tax deduction. But they didn't know how 
much they are really allowed to deduct. And different companies 
had different views on this in trying to understand the tax law 
even.
    Mr. Olson. It sounds like it does hurt for sure. I mean, 
these guys sort of sit back and say hum, Dr. Tour, you are 
doing great work, but I have got shareholders I got to take 
care of, a legal obligation to do that, so I may not invest in 
your great research because of our tax policies.
    Mr. Tour. Absolutely, and there are companies that may even 
be in your district that have said that. I am not exactly sure 
where the border of your district is.
    Mr. Olson. It changes dramatically. But sir, you and I live 
in the energy capital of the world, and so I am thrilled about 
what is happening in the energy sector with nanotechnologies.
    On your Web site, it mentions oil and gas, enhanced 
recovery operations, those type of things. Elaborate on what is 
going on, how you are getting help from industries around 
there, and what we should be excited about.
    Mr. Tour. So we have a project that is funded in total by 
Apache Corporation where we have been able to capture 
CO2 coming out of a natural gas well, so natural gas 
is a very clean sort of carbon fuel, 30 percent lower 
CO2 emissions than running a car on gasoline. But 
coming out with natural gas is CO2. That 
CO2 is generally just vented to the air. We have 
figured out how to trap it and how to send it back down whole. 
Apache is working on the conversion of that to industrial scale 
for the deployment. We are working on nano reporters, which 
these are funded by seven different oil companies in a 
consortium called the Advanced Energy Consortium, where we 
developed sensors that can go down hole and they can travel 
through the sub-three nanometer ports, the sub-three nanometers 
ports down hole, and then bring up information as to how much 
oil is down there. And also nanoparticles for enhanced oil 
recovery, when they see that oil to grab that oil and bring it 
back up, and then self separate. So those are a few examples 
from the oil industry.
    Mr. Olson. Finally, healthcare, medical. As you know, right 
across from Rice University is the Texas Medical Center, the 
largest research institution in America for healthcare 
research. You mentioned--I am sorry, your Web site mentioned 
carbon nanovectors involved in this. What is so exciting about 
carbon nanovectors?
    Mr. Tour. OK, so we can take these carbon particles now, 
and all of this has been licensed to a company. They bought the 
whole suite of patents, licensed the whole suite of patents. 
This is in collaboration with Baylor College of Medicine across 
the street, UT Health Science Center, M.D. Anderson Cancer 
Center, and Methodist Hospital and joint patents between us 
all. These carbon particles, they can trap something called 
super oxide. Super oxide, if someone gets a traumatic brain 
injury, traumatic brain injury is the number one disabler of 
young adults and super oxide causes great degradation to the 
brain in the first several hours after. It is exactly the same 
as the biggest disabler in older adults, which is stroke. It is 
a lack of oxygen. There has been a blockage. There is a lack of 
oxygen. When that blockage is removed and oxygen comes in, 
super oxide forms which degrades the brain. We inject the 
nanoparticles just before we clear the blockage, and then what 
happens is this sequesters the super oxide and makes it 
unreactive towards the brain, and so you get far less brain 
degradation.
    Mr. Olson. I am out of time. Thank you.
    Mr. Terry. I recognize Mr. Johnson. Bill, you are 
recognized.
    Mr. Johnson. Mr. Chairman, I pass. Thank you.
    Mr. Terry. OK, then the gentleman from Missouri, Mr. Long, 
you are recognized for your 5 minutes.
    Mr. Long. Thank you, Mr. Chairman, and Mr. Phillips, as 
someone who started a firm from the bottom, can you give more 
insight into the hurdles that startups deal with with 
nanotechnology?
    Mr. Phillips. Thank you, sir, I would be glad to. We, too, 
as a company and as a scientific nanotechnology company, the 
majority of our scientists are on visas or trying to get visas, 
to the tune of about 80 percent of those, and trying to 
maintain them in the United States is one of our most difficult 
problems. I mean, basically the visa program in the United 
States is so out of date, and so difficult that it is like we 
are telling our Einsteins and our Wernher von Brauns to get the 
heck out of the United States, go home. It is exactly like 
that. We face that issue very day. A number of our scientists 
have become American citizens while working at NanoMech. I am 
proud to say they have gone down to Judge Parker's courtroom 
down in Ft. Smith, Arkansas, raised their hand, and some of the 
greatest scientists ever come out of the Ukraine, India, China, 
have become American citizens through working at NanoMech on 
our nanotechnology. One of the scientists that came out of 
China ran the entire water management program for China when he 
was 29. He is now a proud American citizen. But every day it is 
harder and harder with this visa program. We have one our top 
researchers right now that is working on the most advanced 
systems for the Department of Defense in the way of creating 
the best body armor that ever has existed, totally fireproof, 
totally waterproof, totally antimicrobial, antibacterial. We 
basically finished and we have been trying for 2 years to get 
his wife a visa to join him here in the United States, although 
he was educated here in the United States, received his Ph.D. 
here in the United States. That is kind of an everyday problem 
for us in terms of visa programs.
    Other things in nanotechnology that are difficult, I am not 
a state-run company. I don't want to be a state-run company, 
but I have to compete against state-run companies. In China 
today they have the Nanopolis. The Nanopolis is a multi-, 
multi-, multi-billion dollar project to create commercialized 
nanotechnology. They invite us over there every day. I have 
been invited to be their keynote speaker in China this year for 
the third year in a row, and for the third year in a row, I 
will turn it down. But they are really outspending us at this 
point in time in a big way, along with Russia. Russia has a $10 
billion fund that they are operating in the United States 
called RusNano. Dmitri, who is based out in Silicon Valley, is 
a Russian who has been trying to either invest in us or in 
other companies, and have successfully invested in many 
nanotechnology companies in the United States, as well as 
venture capital companies in an effort to gain access, or if 
not even control, of our nanotechnology that has been produced 
through billions of dollars worth of research through National 
Science Foundation, NIH, down through our incredible university 
system. So we have to capitalize this company in order to build 
very fast. I think we are the fastest growing nanomanufacturing 
company in the United States to do things like we do to create 
new types of greases and lubes. That may not sound like a very 
important thing, it may sound kind of boring, but the world 
runs on machines. Machines run on lubricants. Without it, they 
don't run as well. So we are able to create lubricants that 
make machines basically last a lot longer. For instance, we 
believe if we were lubricating the Navy ships, I have had 
conversations with the Secretary of the Navy on this; we could 
extend the life of our Navy fleet immediately 10 to 20 years 
without any other expenditures, and many things like that. So 
getting access to government-type contracts is very tough for 
smaller companies. Getting access to competitive capital on a 
national and global scale through public/private partnerships 
is becoming harder and harder. Overcoming this thing called the 
valley of death where you go to full-scale scaling companies 
like ours and we operate on patents that we have licensed from 
leading American universities. So just in the area of 
competitiveness, we have the willpower at NanoMech to grow this 
company, to provide incredible new technologies like very 
lightweight body armor that is much, much safer than what is 
out there today, new types of weapons that have never even been 
dreamed of that can be reached through nanotechnology----
    Mr. Long. Let me interrupt you there. I know nanotechnology 
is extremely exciting and there are a lot of tremendous 
benefits from it. I know that in my home State of Missouri that 
Brewer Science has partnered with Missouri State University in 
my hometown and have a very, very good partnership with the 
development of nanotechnologies, so I think that some of these 
public/private partnerships are starting to take root, and I 
hope to see them expand, so good luck to you on your ventures.
    Mr. Binek, can you tell me is Nebraska in the SEC?
    Mr. Terry. That is a cheap shot.
    Mr. Long. Well, I know they are not but I just love hearing 
it. I yield back.
    Mr. Terry. We are united in being former members of the Big 
12 with you.
    Recognize the gentleman from the SEC, Mr. Bilirakis.
    Mr. Bilirakis. Absolutely, best team in the SEC, University 
of Florida Gators. Go Gators.
    Thank you, Mr. Chairman, for holding this hearing on a 
growing sector of America's innovation economy.
    Nanotechnology is a sector that holds exciting prospects 
for the United States with its continued position at the 
forefront of technological advancement and economic growth. 
Nanotechnology is the perfect demonstration of how the private 
marketplace continues to innovate to solve economic and 
societal problems.
    For example, in my district, Dais Analytic, which was named 
to the Forbes magazine's top energy projects to watch in 2012, 
has developed technologies and programs to clean dirty air and 
dirty water. Because nanotechnology is still a relatively new 
phenomenon, it is important that the Federal Government not 
stifle innovation and growth with burdensome and unnecessary 
regulations and red tape.
    Here is my question. I currently serve as the co-chair of 
the Congressional Technology Transfer Caucus, and I am 
interested in how we economically capitalize upon the 
investments made in technology research. I understand that it 
may be difficult to transition from research to licensing to 
commercial development. Can you walk us through, and this is 
for the panel, can you walk us through the challenges that are 
faced in the stages of development, from patenting new research 
and technology to licensing it to companies to commercializing 
it, please? Whoever would like to start.
    Mr. Mrksich. I can begin. I have done this a number of 
times, and having advances in my university lab lead to 
something interesting. Within the universities, we disclose 
that, apply for patents, and at the same time start to form a 
small company. That is sometimes done by raising seed or angle 
money. Sometimes it is done by going straight to venture 
capitalists, if that is the scale of the investment required. 
Then from there it gets a start, and runs on the treadmill and 
hits milestones and raise more capital.
    One comment I want to make about nano, though, this is a 
new area. If you look at biotechnology, there are many repeat 
entrepreneurs that really are quite effective at getting new 
technologies out. There are venture capital firms and angels 
who specialize in that space, and so they are very 
sophisticated in recognizing opportunities and aggressively 
pursuing them.
    Ten years ago, there were just a handful of nanotechnology 
companies that got started. We didn't have the capital 
infrastructure, the sophisticated investors that made it and 
the repeat entrepreneurs that made it more straightforward to 
get started. So as I look back, I think, and in my case, this 
is true as well, the SBIR program has oftentimes been the 
stepping stone to get IEP out of the university into a company 
where you can start working on a prototype and de-risk the 
technology. And I think in this young field still, where many 
of the founders of new companies are first-time founders, they 
are not familiar with the process and there are many barriers 
to getting going. Making it more straightforward to direct SBIR 
funds towards those folks, I would even think about a policy 
that said if you have a research grant from the NSF or the NIH 
or the DOE and a nanospace, and you apply for a patent, that 
you have a streamlined access to an SBIR to get that out of the 
university and put it into the commercial sector where it can 
get going. Because I think there are a lot of things that are 
left on the floor because, again, this young area with first-
time entrepreneurs don't have a straightforward time getting 
something started.
    I will let the others add other perspectives.
    Mr. Bilirakis. Yes, please. Anyone else, please?
    Mr. Tour. I have gone through this many times. I agree with 
Milan and I have known Milan for a long time, is that what I am 
finding now is that it is international companies and entities 
and investors that are coming and wanting to buy up the 
technology.
    Just recently, one of our patents was licensed to a Chinese 
company for the development of super capacitors, and they are 
going to take this on and make batteries for electric vehicles 
this way. Three of our technologies are currently being 
licensed by the Israelis to start companies in three different 
areas, based on the technology that was developed in our 
laboratory. There was a company that was going to start and the 
tax advisor said don't start it in the United States, start it 
in Singapore. And that was purely from a tax consideration 
standpoint.
    So at no other time in my career in the last year or two I 
am seeing this coming of foreign entities and buying up U.S. 
technologies, and so the question then becomes why aren't the 
U.S. entrepreneurs stepping forward as aggressively as the 
international entities, and I am not sure that I have answer to 
that for you, and that is something that there is probably, you 
in this room have thought about this more than I have. But this 
is a trend that I am noticing that the biggest and most 
aggressive buyers of the technology now, in my experience in 
the last several years, are not U.S. entities anymore.
    Mr. Terry. Thank you.
    Recognize the gentleman from Ohio, Mr. Johnson.
    Mr. Johnson. Thank you, Mr. Chairman. I did want to come 
back and kind of take off on what, Dr. Tour, you were just 
talking about. What do you think we need to do to regain U.S. 
competitiveness for human talent and corporate investment as 
compared to what some of those other countries that are doing 
that are state-sponsored, subsidized countries like China and 
others?
    Mr. Tour. Right. So even before coming here, I talked to 
this Israeli group that is licensing three of our technologies 
to certain companies. And I said show me the tax structure of 
what it would cost me to start up a company in Israel. And they 
sent me the links to all of that data, and the tax structure is 
a lot more friendly towards small companies, especially if you 
are going to build your manufacturing entity outside of Tel 
Aviv, moving it. So I am talking about tax rates that are on 
the order of about 7 percent.
    So you look at numbers like this, and I am cognizant of the 
fact that the U.S. government runs on taxes, but I have started 
several small companies myself and I will never start another 
one again. It is a very difficult and arduous task, and so now 
I just go into the licensing and license it out to others. But 
the tax structure is quite aggressive here, and again, I am 
deferring to what the Congresswoman said, and I acknowledge 
that. I am just saying that when you look at the tax structure, 
it is very different.
    My testimony here is saying that without a proper mechanism 
for funding, many of these very smart people that we have are 
now leaving. The U.K. has come with a graphene and carbon 
program that is enormous. The European Union, that is enormous 
and funding at a very large scale. And they are trolling U.S. 
faculty. I had two offers, two offers in the last year from the 
U.K. to move my program there. My program that was 90 percent 
federally funded, 10 percent industrially supported in 2008 is 
now 80 percent industrially supported and 20 percent federally 
supported. Same amount of money. I have been able to make that 
transition, so my testimony is help me to make that transition. 
If the Federal Government can't step up, what can you do in the 
meantime to allow me to bring more money into my laboratory and 
my colleagues into their laboratories to maintain their 
programs here, rather than just having us move abroad. Because 
these folks are industrious folks and they are going to find 
out how to get their program continued. And if that means 
moving overseas, they will do it.
    Mr. Johnson. So is it safe to say, then, that tax reform is 
critically important to retaining nanotechnology expertise in 
America and making us competitive?
    Mr. Tour. I absolutely think so, sir, and I know that is 
not the direct privy of this committee, but I know that you 
have influence in that.
    Mr. Johnson. Dr. Binek, how can research consortia such as 
the Semiconductor Research Corporation be encouraged in the 
U.S.? Have you worked with other similar organizations or know 
of similar organizations working with universities to support 
nanotechnology research?
    Mr. Binek. In the case of the Semiconductor Research 
Corporation, their motivation is basically driven by,I mean, 
they look at the scaling issue and they know if we don't do 
something drastically soon, there will be a major problem 
because who wants a next generation cell phone which just 
changes color, right, but there is no progress anymore. So this 
kind of driving force can, I think, be very strong, but it can 
probably also be very strong, although I have less experience 
outside the semiconductor industry. For other industries, 
however, my concern here is that it is mainly short-driven to 
some extent they have to see the abyss in front by doing their 
own extrapolations, seeing that scaling 2020 will, and then 
they say OK, we better do something, and now it is already a 
little late. And I think we should find ways to do something in 
advance.
    Mr. Johnson. OK. In your testimony, you discuss U.S. 
dependence on rare earth permanent magnets, which are 
predominantly mined in China. So why are these magnets 
important to the U.S. economy and what are the benefits of 
finding alternatives?
    Mr. Binek. So you find them everywhere, from your cell 
phone in the modern lithium ion batteries and I was 
specifically referring to the important use of them in 
permanent magnets. There are high energy permanent magnets 
which enable this extremely lightweight electrical engines, 
which allow for this unmanned aerial vehicles, for example, or 
headphones even. All kinds of applications, wind turbines. For 
example, a 2 megawatt wind turbine has 800 pounds of rare earth 
minerals in it, so they are very important and the thing about 
rare earth, as the name may suggest, they are not that rare. 
You cannot just mine them as other metals like gold or copper. 
They are not really concentrating that much, so you have to 
operate with large volumes and then extract small amounts of 
them. And that is a very costly enterprise, and also it comes 
with a huge burden on the environment. I mean, there are 
stories about these toxic lakes in China which are a big 
problem.
    So finding alternatives to rare earth is certainly an 
important thing, and nanotechnology, again, can help here. For 
example, in the field of permanent magnets we do that also at 
the University of Nebraska. We use nanostructuring of 
materials, bringing hard and soft materials into proximity and 
then get those properties without rare earth, just really 
metals, for example.
    Mr. Terry. Thank you.
    Mr. Johnson. Thank you, Mr. Chairman.
    Mr. Terry. I recognize the gentleman from Mississippi.
    Mr. Harper. Thank you, Mr. Chairman, and thank each of you 
for being here and for your insight. It is certainly amazing 
some of the progress that is being made and the excitement for 
the future of what we can do if we do this properly.
    Dr. Binek, if I may ask a follow-up on Mr. Johnson's 
question, specifically about the rare earth materials. How far 
away are we from developing alternatives at a commercially 
viable high volume manufacturing process?
    Mr. Binek. I think we are still quite a step away to 
replace them. Certainly we will not replace them with a switch 
everywhere. There are different field and different needs 
applications where we can hope to find replacements soon, but I 
am very certain as far as I can predict that they will still 
play an important role in the foreseeable future in many, many 
applications.
    Mr. Harper. Thank you very much.
    Mr. Binek. I may want to mention that there are--as a 
mining operation also again reopened in the United States, but 
it comes with its own problems.
    Mr. Harper. OK, and where is that?
    Mr. Binek. To be honest, I need to pass on that.
    Mr. Harper. OK, that is fine. Thank you very much.
    Mr. Phillips, if I could ask you a few follow-up questions. 
In your testimony, you discuss the U.S. permitting process for 
manufacturing facilities. Why is the time table for approval 
longer in the United States than other countries?
    Mr. Phillips. Well, you could basically say the United 
States perhaps is more advanced in that area in terms of 
guarding safety and regulations and things like that, and to a 
great extent, a lot of those regulations are necessary for a 
good, safe country. But----
    Mr. Harper. OK, and how have other countries----
    Mr. Phillips. I am up against countries that don't even 
know what OSHA is. They have no OSHA. They have no requirements 
for insurance. They have no permits, typically, and so all I do 
is try to make a comparison as to trying to compete against 
those companies and countries like that that are state-run 
companies. It makes it more difficult for a company like us. 
Albeit, we work very closely with our municipalities, our state 
governments, and so forth to expedite those situations to 
reduce the amount of paperwork, typically, that comes with it. 
A lot of it is incredibly redundant paperwork, committees upon 
committees upon committees that you have to deal with that I 
would say could be incredibly streamlined. Having founded a 
company in Mississippi, co-founded a company called Skytel in 
Jackson, Mississippi that became instant messaging and ushered 
that in on a worldwide basis. I can remember back to the days 
in the '90s on how easy it was to do things like that. Of 
course, that was in the digital space, as we moved from analog 
to digital and totally transformed the way business is done. I 
believe that the transformation that is taking place in moving 
from micron technology in a manufacturing scale to now 
nanoscale will dwarf all the benefits we saw in the digital 
world, moving from analog to digital. Unfortunately, as the 
testimony shows today, in Europe and Asia and so forth, they 
are taking nanotechnology tremendously more serious than the 
U.S. government is in terms of advancing it with incredible 
speed, with developing either public/private partnerships or 
outright gifts to corporations to make them competitive. We 
have seen a couple of those in the U.S. A lot of criticism 
about Solyndra. Solyndra received $500 million in funding and 
then went bankrupt, but in China, there were four competitors 
to Solyndra that received $5 billion each to compete and 
dropped the price on a worldwide basis and took the worldwide 
lead in solar. And now the remains of Solyndra are owned by 
China, as is A123, our leading battery company, that received 
$500 million in funding in the U.S., but compared to China it 
was dwarfed.
    So although I'm not, again, wanting to be a state-run 
company or anything like that. We have to look at the entire 
business model on a global basis, not on a U.S. basis, in order 
to compete going forward. It is something we have to get a 
handle on, because if we don't make things, we really cease to 
be a country.
    Mr. Harper. So what you are saying is if there is a way to 
fast track some of this process, that is a great benefit to 
you. And you mentioned countries that maybe are not doing it 
right. Are there some countries that are, indeed, doing it well 
on nanotechnology R&D?
    Mr. Phillips. Well, you look to Germany and Japan and so 
forth and the amount of public/private partnerships that you 
see there are fantastic in terms of the speed, Sweden and 
others. And this is not to over-criticize my country which I 
love dearly and represent it, as in the military days. I think 
we are definitely trying a lot of things, but we are stymied to 
a certain extent in patents right now. The cost of a U.S. 
patent compared to overseas many times is prohibitive and in 
the area of nanotechnology, in order to protect gigantic 
investments it takes to enter into a manufacturing, as opposed 
to digital space, that cost is very high. I just hope 100 years 
from now when America looks back, we don't basically say well, 
we are the country that did Facebook, compared to the country 
that came up with new ways to manufacture that totally created 
new cures, whether it was for cancer or what have you, and 
nanotechnology and maintained a very competitive weaponization 
system, as weapons became smaller and easier to perhaps control 
those weapons in strategic and tactical applications.
    Mr. Harper. Thank you very much, Mr. Phillips. I yield 
back.
    Mr. Terry. Thank you, and the gentleman from New Jersey is 
recognized for 5 minutes.
    Mr. Lance. Thank you, Mr. Chairman.
    Mr. Phillips, in your testimony you referred to various 
policies that may be hampering business investment in 
nanotechnology, including the R&D tax credit. In 16 countries 
with a higher R&D credit than the U.S.--and I am sorry that 
that is the case--I believe that their corporate tax rate is 
different from the United States, and our corporate tax rate is 
among the highest, perhaps the highest in the industrialized 
world. Could you comment on that in a little greater detail, 
and any advice you might be willing to give us in that regard?
    Mr. Phillips. Well, when we have a breakthrough technology 
that hits like digital or like in the case of nanotechnology, 
maybe the Federal Government needs to look at investment tax 
credits on spending by companies in nanotechnology of a variety 
of types so that they can capitalize their manufacturing 
facilities faster, perhaps do more research and development 
faster, and through investment tax credits produce new goods 
that return in the purchase of those goods through sales taxes 
and other type taxes, including income taxes on a federal 
basis, actually multiply the receipts on the tax base, even 
though in the early stages of those companies those changes 
could, without question, accelerate the development, and also 
lead to more investments in those companies from the private 
sector if it favored a technology as robust and with as much 
potential as nanotechnology.
    Mr. Lance. Thank you. I certainly agree with that.
    Dr. Tour, the regulatory landscape for nanotechnology 
drives industries as how they look today. If you would, sir, 
could you expand on the regulatory process for startups and how 
Congress might be involved in improving the situation.
    Mr. Tour. All right. So we don't have good standards now to 
make comparisons and upon which to really target ways to 
mitigate the problem so that the improvement of standards 
against which we could direct these would certainly be a help 
for us to be able to move these along so we generate new 
materials. And then sometimes our--I served for 3 years on E-
Track, which is a Department of Commerce committee to rewrite 
some of the export control laws, and because we have a very 
large book of things that we can export--and it was interesting 
that we couldn't export many of the things that are made 
overseas in much larger volumes than we are even making them. 
So we were hampered in that way and many ways, and that even 
hampered the basic research of collaborating with people.
    So things become archaic, and after 3 years on that 
committee, I stepped down because everything that was proposed 
I wasn't even sure if it was even read. And so I am not sure 
that anything ultimately changed as a result of that.
    So I realize that this is a big country and lots of things 
have to be done, but some of these barriers that really there 
was no good scientific rationale for the inhibitions that were 
there.
    Mr. Lance. And from your expertise, could those matters be 
changed by administrative rule and regulation, or would it 
require a statutory change, change from us here in Congress?
    Mr. Tour. I am sorry, I don't know that.
    Mr. Lance. Certainly it might be easier if it were only to 
require some sort of change from the Department of Commerce or 
another agency of the Executive Branch, but obviously, we and 
our co-equal responsibilities are looking for statutory change 
as well to improve the situation.
    Mr. Tour. Right.
    Mr. Lance. Certainly I thank you for your service, and it 
may seem frustrating but I certainly think it is important that 
talented professionals, including academics, are involved in 
what you do, sir.
    Thank you, Mr. Chairman. I yield back the balance of my 
time.
    Mr. Terry. Thank you, Mr. Vice Chairman. And that concludes 
our question and answer period. I want to thank all of you for 
being here. I think you have enlightened us, especially on 
policy aspects, which is hopefully one of your goals here 
today. I think you have given us several things to think about 
how we can help improve the research and development of 
nanotechnologies in the United States, so I appreciate that.
    So with that, did you want to say something?
    Ms. Schakowsky. Well, let me just thank the witnesses. I 
think this is a real growth area for our country if we do the 
right thing. We have the brains. We have an infrastructure to 
do this, and it would just be such a pity if we lost this in 
the global marketplace.
    So thank you very much for underscoring that, and for 
sharing your expertise.
    Mr. Terry. So we have up to 2 weeks to submit written 
questions to you. Don't know if there will be any, but we have 
that and if we do send you written questions, we would 
appreciate about a couple of weeks timeframe to get your 
written answers back to us.
    With that, thank you again. You have been a great service 
to us, and we are adjourned.
    [Whereupon, at 11:45 a.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]

               Prepared statement of Hon. Henry A. Waxman

    Today's hearing is a valuable one. We will learn how 
scientists and engineers are making significant advances by 
working with nanoparticles.
    Nanoparticles are extremely small. One nanometer is one 
billionth of a meter. A single hair is roughly 75 to 100 
thousand nanometers wide.
    Nanotechnology can be used to reduce the effect of oil 
spills on the environment, improve solar panel output, and help 
detect early-stage Alzheimer's disease. Researchers are working 
on even more applications, including groundbreaking uses in 
cancer treatment and the fight against climate change.
    At the federal level, the National Nanotechnology 
Initiative, or NNI, provides participating agencies with a 
coordinated framework for supporting nanotechnology research, 
development, and manufacturing. I applaud President Obama and 
the Presidential Council of Advisors on Science and Technology, 
or PCAST, for their ongoing support of NNI and their broader 
efforts to bolster this field.
    Thanks in part to their efforts, the United States leads 
the world in nanotechnology investment and research. Important 
research occurs throughout the country, including at the 
California NanoSystems Institute, which I am proud to say has 
one of its two locations within the district I represent, at 
UCLA.
    But our lead in this technology is being challenged. 
Nanotechnology is flourishing not just here, but around the 
globe. Nations have devoted significant effort--and public 
funds--in order to become the most attractive place to 
research, develop, commercialize, and manufacture 
nanotechnology products.
    One problem is that in the United States, the NNI has not 
been reauthorized since 2003, when Congress first gave the 
initiative a statutory foundation and appropriated funds for 
its work. In addition, public funding for nanotechnology 
research has been significantly cut over the last few years, 
with total federal R&D funding for the field dropping nearly 20 
percent from 2010 to 2014. This is a mistake.
    We in Congress should demonstrate our support for 
nanotechnology by increasing scientific research funding in 
next year's budget. We should enhance the educational 
opportunities available to students and workers to ensure they 
have the science, technology, engineering, and mathematics 
knowledge necessary for jobs in nanotechnology. And we should 
play a more active role in the NNI. The program should be 
reauthorized, and in doing so, we should provide an updated, 
cohesive vision for how the U.S. can stay competitive on a 
global scale.
    I am pleased that the Subcommittee will have the 
opportunity today to learn more about nanotechnology from those 
who know it best. While the main topic of this hearing is 
innovation, I encourage members and panelists to remember, in 
addition, that advances through nanotechnology are made 
possible by altering particles at a very basic level. As 
nanotechnology becomes more prolific, scientists like those on 
this panel must come to understand exactly what the 
environmental, health, and safety implications are. And members 
of this Committee must work with agencies, including the 
Environmental Protection Agency, the Food and Drug 
Administration, and the Consumer Product Safety Commission, to 
ensure that human health and safety and the environment are 
protected.
    Thank you.
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