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Congress Wants the National Science Foundation to Have More Firepower

A “Sputnik moment” may have arrived again. Congress is seriously worried about the ability of the country to keep up with the innovative power of China.

In May, U.S. senators Chuck Schumer (D-NY) and Todd Young (R-IN) teamed up with their House of Representatives colleagues to call for augmenting the National Science Foundation’s (NSF) purse. The goal? To appropriate $100 billion in support of the NSF budget.

The proposed legislation is called the “Endless Frontier Act.” The title paraphrases a noted 1945 report by the director of the Office of Scientific Research and Development (OSRD) called “Science – the Endless Frontier” and is credited with the foundation of the NSF a few years later. 

Let me quote Franklin D. Roosevelt from a 1944 letter to the OSRD director, which is included in the 1945 report:

"New frontiers of the mind are before us, and if they are pioneered with the same vision, boldness, and drive with which we have waged this war we can create a fuller and more fruitful employment and a fuller and more fruitful life.”

Let us look at some basic facts first. The NSF would get $100 billion on top of its annual budget of some $8 billion. The new money would come over five years, with possible re-appropriations. The disbursements are to be rear-loaded, with $2 billion allocated in the first year and $35 billion in the fifth year. The agency would be renamed the National Science and Technology Foundation (NSTF) and a new directorate (technology) would get all the additional cash.

The new directorate would be managed independently of the rest of the NSTF, resembling in flexibility the Defense Advanced Research Projects Agency (DARPA). On top of this, Congress also wants the U.S. Department of Commerce to get $10 billion to fund a dozen or so regional technology hubs. These “clusters” of university research, business, and local development are to be located away from existing tech hotspots, such as San Francisco or Boston. The goal is to bring jobs to underserved communities and geographies and to make these regions new viable manufacturing centers.

For the record, NSF is the nation’s premier patron of fundamental sciences, backing primarily research at colleges and universities.

The new technology directorate would continue to spend on fundamental research but also target education/training, commercialization and technology transfer, and entrepreneurship. This latter mandate is a clear departure from the agency’s original roots.

But there is more. The proposed bill spells out areas of particular interest to the legislators. Quoting just four fields to be supported (out of a smorgasbord of others) gives the flavor of the donor’s intentions: artificial intelligence, quantum computing, advanced communications, and advanced manufacturing.

It becomes clear by now that this enterprise has concern about China written all over it. As one commentator wryly noted, naming it “Stay ahead of China Act” might have been a more apt moniker. 

There is nothing wrong with supporting scientific discovery, particularly when fundamental research is a public good that the private sector tends to underinvest in. The United States is an industrial powerhouse and its high tech is world-class. Still, there is fear lurking in corporate boardrooms and the federal government that China is eating (stealing?) America’s lunch. It’s not just about business and jobs and exports. It’s also about national security and the ability of domestic manufacturers to meet future needs. 

Market failure to allocate private capital to fundamental research is well-known. The fruits of private sector fundamental R&D would be appropriated by others while costs are fully internal. Therefore, we have public support for NSF, higher education, and various other schemes, such as Manufacturing USA Institutes.

The Endless Frontiers Act borders on industrial policy, with all its consequences. It’s one thing to fund open-ended research for the benefit of all. It’s another if the government tries to develop new technologies and push commercialization. Yet, it’s not clear how the new directorate would operate and how much “early-stage” R&D it would undertake. Surely the bill will undergo several revisions before becoming law.

In the end, Congress’s bold proposal spells out how high the stakes are. The U.S. is in a race to win key technologies that determine its power balance vis-a-vis China. The lawmakers think that there’s no time to lose.