Forum on Education of the American Physical Society
Fall 2007 Newsletter

The Gathering Storm:  Latest Forecast

By Norman R. Augustine

Several years ago, with the strong leadership of the American Physical Society, an effort was initiated to acquaint Washington policymakers with the state of research in the physical sciences, mathematics and engineering.  That is, to acquaint policymakers with the fact that the federal budget for such endeavors has, in real dollars, languished for two decades and the number of U.S. citizens studying these topics has continued to decline.  This is in sharp contrast with the situation in the biosciences which saw a doubling of research funding in recent years followed, unfortunately, by a period of moderate decline which once again is being followed by increases.  Needless to say, it is of the utmost importance that the growth sought in the physical sciences not be achieved at the expense of research being conducted in the biosciences.  But it is also of the utmost importance that our nation’s investment in the physical sciences be markedly accelerated.

Approximately two years ago, responding to a bipartisan request from members of the House of Representatives and the Senate, the National Academies initiated a study of America’s competitiveness that focused on two questions:  “Are we on a path to remain competitive in the new global economy?” and “What do we need to do to be more competitive?”  The group conducting the study was comprised of 20 members with backgrounds as university presidents, CEO’s, Nobel Laureate researchers, former presidential appointees and state superintendents of schools.  One of the members was subsequently appointed Secretary of Defense.  The group, which became known as the “Gathering Storm” committee after the first part of the title to its 500-page report, focused on jobs and the connection of basic research to the creation of jobs. 

Numerous economic studies have revealed that a major part of the growth in the nation’s GDP (read jobs) and productivity has been attributable to advancements in science and engineering.  Given America’s marked disadvantage in the cost of labor, it is widely agreed that the nation must excel at innovation – that is, being first to market with sought-after goods and services.  Underpinning this strategy will be our prowess in research as the source of new knowledge; in engineering as the transfer mechanism from new knowledge to new products and services; and in entrepreneurship as the means of taking new products and services to market. 

The Gathering Storm committee offered 20 specific actions that could be taken by the federal government – and in many cases paralleled by state and local governments – that would help reverse what the committee concluded was a dismal competitiveness outlook for the nation.  The highest priority of these actions was to improve K-12 math and science education, principally by producing teachers who have their primary undergraduate degrees in math and science, with a teaching certificate as a secondary but important credential.  The second highest priority recommendation was to double the fundamental research budget in mathematics, the physical sciences and engineering in real terms within seven years. 

Following the report’s release, the President included many of its recommendations in his State of the Union address and subsequent budget submission to the Congress.  Early action was taken by the House and Senate, including funding a number of the more critical initiatives in the continuous resolution then before the Congress.  More recently, legislation implementing more of the 20 proposed actions has been authorized with strong bipartisan support, as reflected by a vote of  367 to 57 in the House and by a unanimous consent resolution in the Senate.  A total of $43 billion was authorized for the next three fiscal years.  Much, however, remains to be accomplished.  This includes obtaining approval of the proposed program in the appropriations process, initiating coresponding actions at the state and local levels, and sustaining this overall effort for another ten to twenty years.

While these actions represent an encouraging beginning in addressing a concern that was barely on the Washington radar screen two years ago, America’s economic competitors have not been standing still either.  Reflective of the latter, this past year the World Economic Forum dropped America from first to seventh place in its ranking of various nations’ preparedness to benefit from advances in information technology; the number of U.S. citizens studying engineering declined still further; the remnants of the legendary Bell Labs, birthplace of the laser and transistor and home of many Nobel Laureates, were sold to a French firm; the largest initial public offering in history was conducted by a Chinese bank; another $650 billion was spent on U.S. public schools while the performance of those about to graduate on standardized science and math tests declined further; American companies once again spent three times more on litigation than on research; and in July, for the first time in history, foreign automakers sold more cars in the United States than did American manufacturers. 

There are many ingredients that combine to make up America’s competitive strength.  High among these are labor costs, the education of our citizens, the strength of our fundamental research enterprise, and the “innovation friendliness” of our governmental policies.  The latter include but are not limited to the ease of obtaining specialty visas, our tax policy, our protection of intellectual property, and our litigation environment.

Of particular concern is the fact that  many of America’s parents and students seem unaware of the perilous state of our K-12 educational system, particularly as it relates to math and science.  The Trends in International Mathematics and Science study conducted several years indicated that when it comes to self-perception American youth excel.  U.S. high school seniors ranked number one among students from the 20 participating nations in believing that they are doing well in mathematics and number three in agreeing that they were doing well in science.  The problem is that in the actual mathematics examination, the same group of students finished 18th out of 20 and in the science examination, 17th out of 20. 

A more recent survey conducted by the Public Agenda found that of those respondents expressing an opinion, 62 percent believe that U.S. students are “far behind other countries in math and science.”  But when asked if their local schools should offer more math and science, 70 percent say, “Things are fine as is.”  Worse yet, 76 percent of students and 50 percent of parents state that math and science are irrelevant to the students’ lives.  With regard to the task of increasing the funding of academic research and development, U.S. industry has been devoting a declining share of its investment in R&D to support work conducted in academia, recently reaching a low point of about one percent of industrial R&D spending.  The primary reason for this is, of course, the intense pressure imposed by the equity markets upon industrial firms to produce near-term profits.  In fact, in one recent survey by the National Bureau of Economic Research, 80 percent of the senior financial executives questioned said that they would be willing to forego funding R&D in order to meet their public projections of near-term profitability.  The problem is exacerbated by the previously mentioned stagnant funding of mathematics, the physical sciences and engineering by the federal government. 

The problem is not the lack of worthy ideas to fund:  the National Science Foundation indicates that it can now support only one in five of the research proposals it receives, with the vast majority of the rejected proposals being deemed meritorious by peer reviewers.  Clearly, the solution to this part of the competitiveness dilemma is to increase investment in fundamental research by the federal government with industry continuing to invest in the “D” of R&D and our universities continuing to be the primary performers of fundament research.  Indeed, the past year has seen remarkable progress towards making this a reality; however, fixing the nation’s competitiveness dilemma in what Tom Friedman has so aptly termed “the flat world” is a very long-term undertaking.  There will presumably be no Sputnik, Pearl Harbor or 9/11 wake-up calls.  This is one of those challenges that we must simply recognize ourselves. 

Winston Churchill once said that you can always count on the Americans to do the right thing – after they have tried everything else.  This is one issue where we had better get it right the first time.

Norman R. Augustine is retired chairman and CEO of Lockheed Martin Corporation, a former Under Secretary of the Army, and was the Chairman of the National Academies Gathering Storm Committee.