[Congressional Record Volume 151, Number 131 (Monday, October 17, 2005)]
[Senate]
[Pages S11345-S11350]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
KEEPING OUR COMPETITIVE EDGE
Mr. ALEXANDER. Mr. President, in May, Senator Jeff Bingaman and I,
with the encouragement of the Senate Energy Committee Chairman, Pete
Domenici, asked the National Academies of Sciences and Engineering and
the Institute of Medicine the following question: What are the top 10
actions, in priority order, that Federal policymakers could take over
the next decade to help the United States keep our advantage in science
and technology? That was our question.
To answer the question, the academies assembled a distinguished panel
of business, government, and university leaders, headed by Norm
Augustine, the former chair of Lockheed Martin. The panel also included
three Nobel Prize laureates. The panel took our question seriously, and
I intend to do everything within my power to take their recommendations
seriously. Tomorrow, the Energy Committee will take the first step in
that response by holding a hearing to hear from Mr. Augustine and the
Academies. It will be the first opportunity Congress will have to hear
their answer to our question.
This hearing is primarily about brainpower and the relationship of
brainpower to good American jobs. The United States produces almost
one-third of all the wealth in the world, in terms of gross domestic
product but has only 5 percent of the world's population. We are a
fortunate country indeed. The Academies explained this phenomenon in
this way:
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. . . as much as 85 percent of measured growth in U.S. income
per capita is due to technological change.
This technological change is the result, in the report's words, of an
outpouring of:
. . . well-trained people and the steady stream of scientific
and technological innovations they produce.
The United States has taken extraordinary steps to help create this
outpouring of trained people and new discoveries that have given us
such a disproportionate share of the world's wealth. We have in our
country almost all of the world's great research universities. We have
a unique array of 36 Federal research laboratories. More Americans
attend college than people in any other country, and the colleges they
attend are the best in the world. We have had, until at least recently,
a system of K-12 education unsurpassed in the world.
Government support for all these enterprises has been massive. In
2001, the Federal Government spent $22.5 billion for university-based
research in science and engineering. This year the Government will
provide 60 percent of American students with grants or loans to help
them attend the college or university of their choice. The Federal
Government will spend nearly $17 billion on grants and work-study
programs and will provide an additional $52 billion in student loans.
In my last year as Governor of Tennessee, and I am sure it must have
been as true in Ohio as well, or nearly true, half of State dollars and
a larger proportion of local tax dollars went to support education. Our
free-market environment encouraged innovation and enterprise, as well
as billions of dollars invested in corporate research. Finally, to top
it all off, while we have been outsourcing jobs, we have been
insourcing brainpower--572,000 foreign students attend our colleges and
universities. One-half of the students in our graduate programs of
engineering, science, and computing are foreign students.
There are three reasons I put this question to the National
Academies. First, Congress is facing huge budget challenges over the
next decade as we grapple with restraining the growth of entitlement
spending. I did not want tight budgets to squeeze out the necessary
investments in science and technology that create good jobs. Second, as
the Augustine report details, there are worrisome reports from all
sides in the new competitive world marketplace that the United States
will have to make an even greater effort to keep our high standard of
living. To put it bluntly, people in India, China, Singapore, Finland,
and Ireland know very well that since their brains work similar to our
brains, if brainpower is the secret weapon to produce good jobs, then
there is no reason they can't have a standard of living more similar to
ours. They are working to develop better trained citizens and create
their own stream of discoveries.
Third, I wanted to ask this question to those who should know the
answer. Members of Congress are not the best ones to guess what the
first 10 things we should do are, in the next 10 years, to keep our
science and technology edge. This panel represents the best of those
brains. Congress is not efficiently organized to deal with broad
recommendations such as these. I intend to work with my colleagues to
see that all of the recommendations in the report are introduced and
given a fair hearing in various committees that have jurisdiction. I
see the senior Senator from Missouri and the Senator from Ohio. Both of
them have been leaders in this body on this very question of how do we
keep our secret weapon, our brainpower advantage, in order to keep good
jobs.
But what should happen is that President Bush should make this report
the subject of his State of the Union Address and the focus of his
remaining 3 years in office. This challenge cries out for executive
leadership. This challenge is the real answer to most of our hopes and
the solution to most of our big problems. From high gasoline prices to
the outsourcing of chemical industry jobs, from the shortage of
engineers to the growing number of lower wage jobs, from energy
independence to controlling health care costs, this is the challenge
that most Americans wish their Government would put up front.
We have begun the discussion with a bipartisan question to the wisest
Americans who know the answer. We have a remarkable opportunity now
because of the Augustine report, upon which we will have our hearing
tomorrow. We will have an opportunity now to act on the recommendations
of that report in the same spirit.
Mr. President, I ask unanimous consent to have printed in the Record
the following items: A copy of the executive summary of the Augustine
report entitled ``Rising Above the Gathering Storm.'' This is the
report of the National Academy of Sciences, National Academy of
Engineering, and the Institute of Medicine--4 recommendations with 20
specific steps that we ought to take over the next 10 years to keep our
brainpower advantage so we can keep good jobs. Second, I ask unanimous
consent to have printed after that the article by Thomas L. Friedman in
the New York Times, on October 14, called ``Keeping Us in the Race,''
which is his commentary on the Augustine report.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Rising Above the Gathering Storm
Committee Biographic Information
NORMAN R. AUGUSTINE [NAE] (Chair) is the retired chairman
and CEO of the Lockheed Martin Corporation. He serves on the
President's Council of Advisors on Science and Technology and
has served as undersecretary of the Army. He is a recipient
of the National Medal of Technology.
CRAIG BARRETT [NAE] is chairman of the Board of the Intel
Corporation.
GAIL CASSELL [IOM] is vice president for scientific affairs
and a Distinguished Lilly Research Scholar for Infectious
Diseases at Eli Lilly and Company.
STEVEN CHU [NAS] is the director of the E.O. Lawrence
Berkeley National Laboratory. He was a cowinner of the Nobel
prize in physics in 1997.
ROBERT GATES is the president of Texas A&M University and
served as Director of Central Intelligence.
NANCY GRASMICK is the Maryland State Superintendent of
Schools.
CHARLES HOLLIDAY JR. [NAE] is chairman of the Board and CEO
of DuPont.
SHIRLEY ANN JACKSON [NAE] is president of Rensselaer
Polytechnic Institute. She is the immediate past president of
the American Association for the Advancement of Science and
was chairman of the U.S. Nuclear Regulatory Commission.
ANITA K. JONES [NAE] is the Lawrence R. Quarles Professor
of Engineering and Applied Science at the University of
Virginia. She served as director of defense research and
engineering at the U.S. Department of Defense and was vice-
chair of the National Science Board.
JOSHUA LEDERBERG [NAS/IOM] is the Sackler Foundation
Scholar at Rockefeller University in New York. He was a
cowinner of the Nobel prize in physiology or medicine in
1958.
RICHARD LEVIN is president of Yale University and the
Frederick William Beinecke Professor of Economics.
C.D. (DAN) MOTE JR. [NAE] is president of the University of
Maryland and the Glenn L. Martin Institute Professor of
Engineering.
CHERRY MURRAY [NAS/NAE] is the deputy director for science
and technology at Lawrence Livermore National Laboratory. She
was formerly the senior vice president at Bell Labs, Lucent
Technologies.
PETER O'DONNELL JR. is president of the O'Donnell
Foundation of Dallas, a private foundation that develops and
funds model programs designed to strengthen engineering and
science education and research.
LEE R. RAYMOND [NAE] is the chairman of the Board and CEO
of Exxon Mobil Corporation.
ROBERT C. RICHARDSON [NAS] is the F.R. Newman Professor of
Physics and the vice provost for research at Cornell
University. He was a cowinner of the Nobel prize in physics
in 1996.
P. ROY VAGELOS [NAS/IOM] is the retired chairman and CEO of
Merck & Co., Inc. He serves as chairman of New Jersey's
Commission on Jobs, Growth, and Economic Development.
CHARLES M. VEST [NAE] is president emeritus of MIT and a
professor of mechanical engineering. He serves on the
President's Council of Advisors on Science and Technology and
is the immediate past chair of the Association of American
Universities.
GEORGE M. WHITESIDES [NAS/NAE] is the Woodford L. & Ann A.
Flowers University Professor at Harvard University. He has
served as an adviser for the National Science Foundation and
the Defense Advanced Research Projects Agency.
RICHARD N. ZARE [NAS] is the Marguerite Blake Wilbur
Professor of Natural Science at Stanford University. He was
chair of the National Science Board from 1996 to 1998.
FOR MORE INFORMATION: This report was developed under the
aegis of the National Academies Committee on Science,
Engineering, and Public Policy (COSEPUP), a joint committee
of the three honorific academies--the National Academy of
Sciences [NAS], the National Academy of Engineering [NAE],
and the Institute of Medicine [IOM]. Its overall charge is to
address cross-cutting
[[Page S11347]]
issues in science and technology policy that affect the
health of the national research enterprise.
More information, including the full body of the report, is
available at COSEPUP's Web site, www.nationalacademies.org/
cosepup.
EXECUTIVE SUMMARY
The United States takes deserved pride in the vitality of
its economy, which forms the foundation of our high quality
of life, our national security, and our hope that our
children and grandchildren will inherit ever-greater
opportunities. That vitality is derived in large part from
the productivity of well-trained people and the steady stream
of scientific and technical innovations they produce. Without
high-quality, knowledge-intensive jobs and the innovative
enterprises that lead to discovery and new technology, our
economy will suffer and our people will face a lower standard
of living. Economic studies conducted before the information-
technology revolution have shown that even then as much as
85% of measured growth in U.S. income per capita is due to
technological change.
Today, Americans are feeling the gradual and subtle effects
of globalization that challenge the economic and strategic
leadership that the United States has enjoyed since World War
II. A substantial portion of our workforce finds itself in
direct competition for jobs with lower-wage workers around
the globe, and leading-edge scientific and engineering work
is being accomplished in many parts of the world. Thanks to
globalization, driven by modem communications and other
advances, workers in virtually every sector must now face
competitors who live just a mouse-click away in Ireland,
Finland, China, India, or dozens of other nations whose
economies are growing.
CHARGE TO THE COMMITTEE
The National Academies was asked by Senator Lamar Alexander
and Senator Jeff Bingaman of the Committee on Energy and
Natural Resources, with endorsement by Representatives
Sherwood Boehlert and Bart Gordon of the House Committee on
Science, to respond to the following questions: What are the
top 10 actions, in priority order, that federal policy-makers
could take to enhance the science and technology enterprise
so that the United States can successfully compete, prosper,
and be secure in the global community of the 21st Century?
What strategy, with several concrete steps, could be used to
implement each of those actions?
The National Academies created the Committee on Prospering
in the Global Economy of the 21st Century to respond to this
request. The charge constitutes a challenge both daunting and
exhilarating: To recommend to the Nation specific steps that
can best strengthen the quality of life in America--our
prosperity, our health, and our security. The committee has
been cautious in its analysis of information. However, the
available information is only partly adequate for the
committee's needs. In addition, the time allotted to develop
the report (10 weeks from the time of the committee's meeting
to report release) limited the ability of the committee to
conduct a thorough analysis. Even if unlimited time were
available, definitive analyses on many issues are not
possible given the uncertainties involved.
This report reflects the consensus views and judgment of
the committee members. Although the committee includes
leaders in academe, industry, and government--several current
and former industry chief executive officers, university
presidents, researchers (including three Nobel prize
winners), and former presidential appointees--the array of
topics and policies covered is so broad that it was not
possible to assemble a committee of 20 members with direct
expertise in each relevant area. Because of those
limitations, the committee has relied heavily on the judgment
of many experts in the study's focus groups, additional
consultations via e-mail and telephone with other experts,
and an unusually large panel of reviewers. Although other
solutions are undoubtedly possible, the committee believes
that its recommendations, if implemented, will help the
United States achieve prosperity in the 21st century.
FINDINGS
Having reviewed trends in the United States and abroad, the
committee is deeply concerned that the scientific and
technical building blocks of our economic leadership are
eroding at a time when many other nations are gathering
strength. We strongly believe that a worldwide strengthening
will benefit the world's economy--particularly in the
creation of jobs in countries that are far less well-off than
the United States. But we are worried about the future
prosperity of the United States. Although many people assume
that United States will always be a world leader in science
and technology, this may not continue to be the case inasmuch
as great minds and ideas exist throughout the world. We fear
the abruptness with which a lead in science and technology
can be lost--and the difficulty of recovering a lead once
lost, if indeed it can be regained at all.
This Nation must prepare with great urgency to preserve its
strategic and economic security. Because other nations have,
and probably will continue to have, the competitive advantage
of a low-wage structure, the United States must compete by
optimizing its knowledge-based resources, particularly in
science and technology, and by sustaining the most fertile
environment for new and revitalized industries and the well-
paying jobs they bring. We have already seen that capital,
factories, and laboratories readily move wherever they are
thought to have the greatest promise of return to investors.
RECOMMENDATIONS
The committee reviewed hundreds of detailed suggestions--
including various calls for novel and untested mechanisms--
from other committees, from its focus groups, and from its
own members. The challenge is immense, and the actions needed
to respond are immense as well.
The committee identified two key challenges that are
tightly coupled to scientific and engineering prowess:
Creating high-quality jobs for Americans and responding to
the nation's need for clean, affordable, and reliable energy.
To address those challenges, the committee structured its
ideas according to four basic recommendations that focus on
the human, financial, and knowledge capital necessary for
U.S. prosperity.
The four recommendations focus on actions in K-12 education
(10,000 Teachers, 10 Million Minds), research (Sowing the
Seeds), higher education (Best and Brightest), and economic
policy (Incentives for Innovation) that are set forth in the
following sections. Also provided are a total of 20
implementation steps for reaching the goals set forth in the
recommendations.
Some actions involve changes in the law. Others require
financial support that would come from reallocation of
existing funds or, if necessary, from new funds. Overall, the
committee believes that the investments are modest relative
to the magnitude of the return the Nation can expect in the
creation of new high-quality jobs and in responding to its
energy needs.
10,000 TEACHERS, 10 MILLION MINDS AND K-12 SCIENCE AND MATHEMATICS
EDUCATION
Recommendation A: Increase America's talent pool by vastly
improving K-12 science and mathematics education.
Implementation Actions. The highest priority should be
assigned to the following actions and programs. All should be
subjected to continuing evaluation and refinement as they are
implemented:
Action A-1: Annually recruit 10,000 science and mathematics
teachers by awarding 4-year scholarships and thereby
educating 10 million minds. Attract 10,000 of America's
brightest students to the teaching profession every year,
each of whom can have an impact on 1,000 students over the
life of their careers. The program would award competitive 4-
year scholarships for students to obtain bachelor's degrees
in the physical or life sciences, engineering, or mathematics
with concurrent certification as K-12 science and mathematics
teachers. The merit-based scholarships would provide up to
$20,000 a year for 4 years for qualified educational
expenses, including tuition and fees, and require a
commitment to 5 years of service in public K-12 schools. A
$10,000 annual bonus would go to participating teachers in
underserved schools in inner cities and rural areas. To
provide the highest-quality education for undergraduates who
want to become teachers, it would be important to award
matching grants, perhaps $1 million a year for up to 5 years,
to as many as 100 universities and colleges to encourage them
to establish integrated 4-year undergraduate programs leading
to bachelor's degrees in science, engineering, or mathematics
with teacher certification.
Action A-2: Strengthen the skills of 250,000 teachers
through training and education programs at summer institutes,
in master's programs, and Advanced Placement and
International Baccalaureate (AP and IB) training programs and
thus inspires students every day. Use proven models to
strengthen the skills (and compensation, which is based on
education and skill level) of 250,000 current K-12 teachers:
Summer institutes: Provide matching grants to state and
regional 1- to 2-week summer institutes to upgrade as many as
50,000 practicing teachers each summer. The material covered
would allow teachers to keep current with recent developments
in science, mathematics, and technology and allow for the
exchange of best teaching practices. The Merck Institute for
Science Education is a model for this recommendation.
Science and mathematics master's programs: Provide grants
to universities to offer 50,000 current middle-school and
high-school science, mathematics, and technology teachers
(with or without undergraduate science, mathematics, or
engineering degrees) 2-year, part-time master's degree
programs that focus on rigorous science and mathematics
content and pedagogy. The model for this recommendation is
the University of Pennsylvania Science Teachers Institute.
AP, IB, and pre-AP or pre-IB training: Train an additional
70,000 AP or IB and 80,000 pre-AP or pre-IB instructors to
teach advanced courses in mathematics and science. Assuming
satisfactory performance, teachers may receive incentive
payments of up to $2,000 per year, as well as $100 for each
student who passes an AP or IB exam in mathematics or
science. There are two models for this program: the Advanced
Placement Incentive Program and Laying the Foundation, a pre-
AP program.
K-12 curriculum materials modeled on world-class standards.
Foster high-quality teaching with world-class curricula,
standards, and assessments of student learning.
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Convene a national panel to collect, evaluate, and develop
rigorous K-12 materials that would be available free of
charge as a voluntary national curriculum. The model for this
recommendation is the Project Lead the Way pre-engineering
courseware.
Action A-3: Enlarge the pipeline by increasing the number
of students who take AP and IB science and mathematics
courses. Create opportunities and incentives for middle-
school and high-school students to pursue advanced work in
science and mathematics. By 2010, increase the number of
students in AP and IB mathematics and science courses from
1.2 million to 4.5 million, and set a goal of tripling the
number who pass those tests, to 700,000, by 2010. Student
incentives for success would include 50% examination fee
rebates and $100 mini-scholarships for each passing score on
an AP or IB mathematics and science examination.
The committee proposes expansion of two additional
approaches to improving K-12 science and mathematics
education that are already in use:
Statewide specialty high schools. Specialty secondary
education can foster leaders in science, technology, and
mathematics. Specialty schools immerse students in high-
quality science, technology, and mathematics education; serve
as a mechanism to test teaching materials; provide a training
ground for K-12 teachers; and provide the resources and staff
for summer programs that introduce students to science and
mathematics.
Inquiry-based learning. Summer internships and research
opportunities provide especially valuable laboratory
experience for both middle-school and high-school students.
sowing the seeds through science and engineering research
Recommendation B: Sustain and strengthen the nation's
traditional commitment to long-term basic research that has
the potential to be transformational to maintain the flow of
new ideas that fuel the economy, provide security, and
enhance the quality of life.
Action B-1: Increase the federal investment in long-term
basic research by 10% a year over the next 7 years, through
reallocation of existing funds or if necessary through the
investment of new funds. Special attention should go to the
physical sciences, engineering, mathematics, and information
sciences and to Department of Defense (DOD) basic-research
funding. This special attention does not mean that there
should be a disinvestment in such important fields as the
life sciences (which have seen growth in recent years) or the
social sciences. A balanced research portfolio in all fields
of science and engineering research is critical to U.S.
prosperity. This investment should be evaluated regularly to
realign the research portfolio--unsuccessful projects and
venues of research should be replaced with emerging research
projects and venues that have greater promise.
Action B-2: Provide new research grants of $500,000 each
annually, payable over 5 years, to 200 of our most
outstanding early-career researchers. The grants would be
made through existing Federal research agencies--the National
Institutes of Health (NIH), the National Science Foundation
(NSF), the Department of Energy (DOE), DOD, and the National
Aeronautics and Space Administration--to underwrite new
research opportunities at universities and government
laboratories.
Action B-3: Institute a National Coordination Office for
Research Infrastructure to manage a centralized research-
infrastructure fund of $500 million per year over the next 5
years--through reallocation of existing funds or if necessary
through the investment of new funds--to ensure that
universities and government laboratories create and maintain
the facilities and equipment needed for leading-edge
scientific discovery and technological development.
Universities and national laboratories would compete annually
for these funds.
Action B-4: Allocate at least 8% of the budgets of Federal
research agencies to discretionary funding that would be
managed by technical program managers in the agencies and be
focused on catalyzing high-risk, high-payoff research.
Action B-5: Create in the Department of Energy (DOE) an
organization like the Defense Advanced Research Projects
Agency (DARPA) called the Advanced Research Projects Agency-
Energy (ARPA-E). The director of ARPA-E would report to the
under secretary for science and would be charged with
sponsoring specific research and development programs to meet
the nation's long-term energy challenges. The new agency
would support creative ``out-of-the-box'' transformational
generic energy research that industry by itself cannot or
will not support and in which risk may be high but success
would provide dramatic benefits for the nation. This would
accelerate the process by which knowledge obtained through
research is transformed to create jobs and address
environmental, energy, and security issues. ARPA-E would be
based on the historically successful DARPA model and would be
designed as a lean and agile organization with a great deal
of independence that can start and stop targeted programs on
the basis of performance. The agency would itself perform no
research or transitional effort itself but would fund such
work conducted by universities, startups, established firms,
and others. Its staff would turn over about every 4 years.
Although the agency would be focused on specific energy
issues, it is expected that its work (like that of DARPA or
NIH) will have important spinoff benefits, including aiding
in the education of the next generation of researchers.
Funding for ARPA-E would start at $300 million the first year
and increase to $1 billion per year over 5-6 years, at which
point the program's effectiveness would be evaluated.
Action B-6: Institute a Presidential Innovation Award to
stimulate scientific and engineering advances in the national
interest. Existing presidential awards address lifetime
achievements or promising young scholars, but the proposed
new awards would identify and recognize persons who develop
unique scientific and engineering innovations in the national
interest at the time they occur.
best and brightest in science and engineering higher education
Recommendation C: Make the United States the most
attractive setting in which to study and perform research so
that we can develop, recruit, and retain the best and
brightest students, scientists, and engineers from within the
United States and throughout the world.
Action C-1: Increase the number and proportion of U.S.
citizens who earn physical-sciences, life-sciences,
engineering, and mathematics bachelor's degrees by providing
25,000 new 4-year competitive undergraduate scholarships each
year to U.S. citizens attending U.S. institutions. The
Undergraduate Scholar Awards in Science, Technology,
Engineering, and Mathematics (USA-STEM) would be distributed
to states on the basis of the size of their congressional
delegations and awarded on the basis of national
examinations. An award would provide up to $20,000 annually
for tuition and fees.
Action C-2: Increase the number of U.S. citizens pursuing
graduate study in ``areas of national need'' by funding 5,000
new graduate fellowships each year. NSF should administer the
program and draw on the advice of other Federal research
agencies to define national needs. The focus on national
needs is important both to ensure an adequate supply of
doctoral scientists and engineers and to ensure that there
are appropriate employment opportunities for students once
they receive their degrees. Portable fellowships would
provide funds of up to $20,000 annually directly to students,
who would choose where to pursue graduate studies instead of
being required to follow faculty research grants.
Action C-3: Provide a Federal tax credit to encourage
employers to make continuing education available (either
internally or through colleges and universities) to
practicing scientists and engineers. These incentives would
promote career-long learning to keep the workforce current in
the face of rapidly evolving scientific and engineering
discoveries and technological advances and would allow for
retraining to meet new demands of the job market.
Action C-4: Continue to improve visa processing for
international students and scholars to provide less complex
procedures and continue to make improvements on such issues
as visa categories and duration, travel for scientific
meetings, the technology-alert list, reciprocity agreements,
and changes in status.
Action C-5: Provide a 1-year automatic visa extension to
international students who receive doctorates or the
equivalent in science, technology, engineering, mathematics,
or other fields of national need at qualified U.S.
institutions to remain in the United States to seek
employment. If these students are offered jobs by United
States-based employers and pass a security screening test,
they should be provided automatic work permits and expedited
residence status. If students are unable to obtain employment
within 1 year, their visas would expire.
Action C-6: Institute a new skills-based, preferential
immigration option. Doctoral-level education and science and
engineering skills would substantially raise an applicant's
chances and priority in obtaining U.S. citizenship. In the
interim, the number of H-1B visas should be increased by
10,000, and the additional visas should be available for
industry to hire science and engineering applicants with
doctorates from U.S. universities.
Action C-7: Reform the current system of ``deemed
exports''. The new system should provide international
students and researchers engaged in fundamental research in
the United States with access to information and research
equipment in U.S. industrial, academic, and national
laboratories comparable with the access provided to U.S.
citizens and permanent residents in a similar status. It
would, of course, exclude information and facilities
restricted under national-security regulations. In addition,
the effect of deemed-exports regulations on the education and
fundamental research work of international students and
scholars should be limited by removing all technology items
(information and equipment) from the deemed-exports
technology list that are available for purchase on the
overseas open market from foreign or U.S. companies or that
have manuals that are available in the public domain, in
libraries, over the Internet, or from manufacturers.
incentives for innovation and the investment environment
Recommendation D: Ensure that the United States is the
premier place in the world to innovate; invest in downstream
activities such as manufacturing and marketing; and create
high-paying jobs that are
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based on innovation by modernizing the patent system,
realigning tax policies to encourage innovation, and ensuring
affordable broadband access.
Action D-1: Enhance intellectual-property protection for
the 21st century global economy to ensure that systems for
protecting patents and other forms of intellectual property
underlie the emerging knowledge economy but allow research to
enhance innovation. The patent system requires reform of four
specific kinds:
Provide the Patent and Trademark Office sufficient
resources to make intellectual-property protection more
timely, predictable, and effective.
Reconfigure the U.S. patent system by switching to a
``first-inventor-to-file'' system and by instituting
administrative review after a patent is granted. Those
reforms would bring the U.S. system into alignment with
patent systems in Europe and Japan.
Shield research uses of patented inventions from
infringement liability. One recent court decision could
jeopardize the long-assumed ability of academic researchers
to use patented inventions for research.
Change intellectual-property laws that act as barriers to
innovation in specific industries, such as those related to
data exclusivity (in pharmaceuticals) and those which
increase the volume and unpredictability of litigation
(especially in information-technology industries).
Action D-2: Enact a stronger research and development tax
credit to encourage private investment in innovation. The
current Research and Experimentation Tax Credit goes to
companies that increase their research and development
spending above a base amount calculated from their spending
in prior years. Congress and the administration should make
the credit permanent, and it should be increased from 20% to
40% of the qualifying increase so that the U.S. tax credit is
competitive with that of other countries. The credit should
be extended to companies that have consistently spent large
amounts on research and development so that they will not be
subject to the current de facto penalties for previously
investing in research and development.
Action D-3: Provide tax incentives for United States-based
innovation. Many policies and programs affect innovation and
the nation's ability to profit from it. It was not possible
for the committee to conduct an exhaustive examination, but
alternatives to current economic policies should be examined
and, if deemed beneficial to the United States, pursued.
These alternatives could include changes in overall corporate
tax rates, provision of incentives for the purchase of high-
technology research and manufacturing equipment, treatment of
capital gains, and incentives for long-term investments in
innovation. The Council of Economic Advisers and the
Congressional Budget Office should conduct a comprehensive
analysis to examine how the United States compares with other
nations as a location for innovation and related activities
with a view to ensuring that the United States is one of the
most attractive places in the world for long-term innovation-
related investment. From a tax standpoint, that is not now
the case.
Action D-4: Ensure ubiquitous broadband Internet access.
Several nations are well ahead of the United States in
providing broadband access for home, school, and business.
That capability will do as much to drive innovation, the
economy, and job creation in the 21st century as did access
to the telephone, interstate highways, and air travel into
the 20th century. Congress and the administration should take
action--mainly in the regulatory arena and in spectrum
management--to ensure widespread affordable broadband access
in the near future.
conclusion
The committee believes that its recommendations and the
actions proposed to implement them merit serious
consideration if we are to ensure that our nation continues
to enjoy the jobs, security, and high standard of living that
this and previous generations worked so hard to create.
Although the committee was asked only to recommend actions
that can be taken by the federal government, it is clear that
related actions at the state and local levels are equally
important for U.S. prosperity, as are actions taken by each
American family. The United States faces an enormous
challenge because of the disadvantage it faces in labor cost.
Science and technology provide the opportunity to overcome
that disadvantage by creating scientists and engineers with
the ability to create entire new industries--much as has been
done in the past.
It is easy to be complacent about U.S. competitiveness and
pre-eminence in science and technology. We have led the world
for decades, and we continue to do so in many research fields
today. But the world is changing rapidly, and our advantages
are no longer unique. Without a renewed effort to bolster the
foundations of our competitiveness, we can expect to lose our
privileged position. For the first time in generations, the
nation's children could face poorer prospects than their
parents and grandparents did. We owe our current prosperity,
security, and good health to the investments of past
generations, and we are obliged to renew those commitments in
education, research, and innovation policies to ensure that
the American people continue to benefit from the remarkable
opportunities provided by the rapid development of the global
economy and its not inconsiderable underpinning in science
and technology.
SOME WORRISOME INDICATORS
When asked in spring 2005 what is the most attractive place
in the world in which to ``lead a good life'', respondents in
only one of the 16 countries polled (India) indicated the
United States.
For the cost of one chemist or one engineer in the United
States, a company can hire about five chemists in China or 11
engineers in India.
For the first time, the most capable high-energy particle
accelerator on Earth will, beginning in 2007, reside outside
the United States.
The United States is today a net importer of high-
technology products. Its share of global high-technology
exports has fallen in the last 2 decades from 30% to 17%, and
its trade balance in high-technology manufactured goods
shifted from plus $33 billion in 1990 to a negative $24
billion in 2004.
Chemical companies closed 70 facilities in the United
States in 2004 and have tagged 40 more for shutdown. Of 120
chemical plants being built around the world with price tags
of $1 billion or more, one is in the United States and 50 in
China.
Fewer than one-third of U.S. 4th grade and 8th grade
students performed at or above a level called ``proficient''
in mathematics; ``proficiency'' was considered the ability to
exhibit competence with challenging subject matter.
Alarmingly, about one-third of the 4th graders and one-fifth
of the 8th graders lacked the competence to perform basic
mathematical computations.
U.S. 12th graders recently performed below the
international average for 21 countries on a test of general
knowledge in mathematics and science. In addition, an
advanced mathematics assessment was administered to U.S.
students who were taking or had taken precalculus, calculus,
or Advanced Placement calculus and to students in 15 other
countries who were taking or had taken advanced mathematics
courses. Eleven nations outperformed the United States, and
four countries had scores similar to the U.S. scores. No
nation scored significantly below the United States.
In 1999, only 41% of U.S. 8th grade students received
instruction from a mathematics teacher who specialized in
mathematics, considerably lower than the international
average of 71%.
In one recent period, low-wage employers, such as Wal-Mart
(now the nation's largest employer) and McDonald's, created
44% of the new jobs, while high-wage employers created only
29% of the new jobs.
In 2003, only three American companies ranked among the top
10 recipients of patents granted by the United States Patent
and Trademark Office.
In Germany, 36% of undergraduates receive their degrees in
science and engineering. In China, the figure is 59%, and in
Japan 66%. In the United States, the corresponding figure is
32%.
The United States is said to have 10.5 million illegal
immigrants, but under the law the number of visas set aside
for ``highly qualified foreign workers'' dropped to 65,000 a
year from its 195,000 peak.
In 2004, China graduated over 600,000 engineers, India
350,000, and America about 70,000.
In 2001 (the most recent year for which data are
available), U.S. industry spent more on tort litigation than
on R&D.
____
[From the New York Times, Oct. 14, 2005]
Keeping Us in the Race
(By Thomas L. Friedman)
What if we were really having a national discussion about
what is most important to the country today and on the minds
of most parents?
I have no doubt that it would be a loud, noisy dinner-table
conversation about why so many U.S. manufacturers are moving
abroad--not just to find lower wages, but to find smarter
workers, better infrastructure and cheaper health care. It
would be about why in Germany, 36 percent of undergrads
receive degrees in science and engineering; in China, 59
percent; in Japan, 66 percent; and in America, only 32
percent. It would be about why Japanese on bullet trains can
get access to the Internet with cellphones, and Americans get
their cellphone service interrupted five minutes from home.
It would be about why U.S. 12th graders recently performed
below the international average for 21 countries in math and
science, and it would be about why, in recent years, U.S.
industry appears to have spent more on lawsuits than on R.&D.
Yes, we'd be talking about why the world is racing us to the
top, not the bottom, and why we are quietly falling behind.
And late in the evening, as the wine bottles emptied,
someone at the national dinner table might finally say:
``Hey, what if we were really thinking ahead? What if we
asked some of the country's best minds to make a list of the
steps we could take right now to enhance America's technology
base?''
Fortunately, two senators, Lamar Alexander and Jeff
Bingaman, asked the National Academy of Sciences, the
National Academy of Engineering and the Institute of Medicine
to form a bipartisan study group to produce just such a list,
which was released on Wednesday in a report called ``Rising
Above the Gathering Storm.''
Because of globalization, the report begins, U.S. ``workers
in virtually every sector must now face competitors who live
just a mouse-click away in Ireland, Finland, India or dozens
of other nations whose economies are growing. Having reviewed
the trends in the
[[Page S11350]]
United States and abroad, the committee is deeply concerned
that the scientific and technical building blocks of our
economic leadership are eroding at a time when many other
nations are gathering strength. We are worried about the
future prosperity of the United States. We fear the
abruptness with which a lead in science and technology can be
lost and the difficulty of recovering a lead once lost--if
indeed it can be regained at all.''
The report's key recommendations? Nothing fancy. Charles
Vest, the former president of M.I.T., summed them up: ``We
need to get back to basic blocking and tackling''--educating
more Americans in the skills needed for 21st-century jobs.
Among the top priorities, the report says, should be these:
(1) Annually recruiting 10,000 science and math teachers by
awarding four-year merit-based scholarships, to be paid back
through five years of K-12 public school teaching. (We have
too many unqualified science and math teachers.)
(2) Strengthening the math and science skills of 250,000
other teachers through extracurricular programs.
(3) Creating opportunities and incentives for many more
middle school and high school students to take advanced math
and science courses, by offering, among other things, $100
mini-scholarships for success in exams, and creating more
specialty math-and-science schools.
(4) Increasing federal investment in long-term basic
research by 10 percent a year over the next seven years.
(5) Annually providing research grants of $500,000 each,
payable over five years, to 200 of America's most outstanding
young researchers.
(6) Creating a new Advanced Research Projects Agency in the
Energy Department to support ``creative out-of-the-box
transformational energy research that industry by itself
cannot or will not support and in which risk may be high, but
success would provide dramatic benefits for the nation.''
(7) Granting automatic one-year visa extensions to foreign
students in the U.S. who receive doctorates in science,
engineering or math so they can seek employment here, and
creating 5,000 National Science Foundation-administered
graduate fellowships to increase the number of U.S. citizens
earning doctoral degrees in fields of ``national need.'' (See
the rest at www.nationalacademies.org <http://
www.nationalacademies.org>.)
These proposals are the new New Deal urgently called for by
our times. This is where President Bush should have focused
his second term, instead of squandering it on a silly,
ideological jag called Social Security privatization.
Because, as this report concludes, ``Without a renewed effort
to bolster the foundations of our competitiveness, we can
expect to lose our privileged position.''
____________________