The system is broken and needs to be scrapped. The system I have in mind is the one for federal funding of research and development. Make no mistake, it was a great system in its time. Formed in the cauldron of World War II, public funding of research and development delivered an impressive bounty well into the 1970s. Many contemporary technologies, notably electronics and computing, were essentially created by military patronage. And modern medicine is a creature of federal largesse.
But for the past 25 years, special interests have wasted a big share of government monies for innovation. With the exception of biomedical engineering, the government isn’t a significant player in any critical field of technology. The reason is simple: To succeed today, innovations must spawn entire industries. This means private-sector sponsorship is crucial to whether a breakthrough turns into a real winner.
This isn’t news to anyone in Washington. And yet the leadership needed to act on the new reality is lacking. This failure starts at the very top. Despite his political alliance with high-tech entrepreneurs, Bill Clinton has no original ideas about innovation. He has simply perpetuated the spent policies of the past. No one in Congress-and I mean no one-understands technological issues either.
But change is possible. The United States is the world’s acknowledged technological leader, and our economy is humming. There will never be a better time to “reinvent” the $68 billion federal R&D “welfare state.” First, let’s look at how much some selected agencies received for fiscal year 1997.
A few questions about this list will send us in the right direction. Does NASA, with its utopian engineering projects such as the space station, deserve to be one of the biggest recipients of government research funds? Should the Department of Defense (DOD) grab nearly half of all federal research spending? Why does the Department of Energy (DOE), mismanaged even by the standards of the public sector, spend billions of dollars on projects far removed from its core mission of building and safeguarding nuclear weapons? Is there any reason for the Commerce Department’s Advanced Technology Program to duplicate efforts of venture capitalists?