Federal R&D: Overview, Update and Outlook Matt Hourihan October 9, 2013 for the Science Diplomats Club AAAS R&D Budget and Policy Program .

Federal R&D: Overview, Update and Outlook

Matt HourihanOctober 9, 2013for the Science Diplomats Club

AAAS R&D Budget and Policy Programhttp://www.aaas.org/spp/rd

0%

5%

10%

15%

20%

25%

30%

DefenseDiscretionary

NondefenseDiscretionary

Mandatory

Net Interest

Federal Spending as a Percent of GDP, 1962 - 2018

Source: Budget of the U.S. Government FY 2014.© 2013 AAAS

Defense Discretionary

$120

[Defense R&D]$15

Nondefense Discretionary

$126

[Nondefense R&D]$16

Social Security$117

Medicare$31

Medicaid$14

Other Mandatory$100

Net Interest$53

Composition of the FY 1980 Budgetoutlays in billions of dollars

Source: Budget of the United States Government FY 2013.© 2012 AAAS

Defense Discretionary

$515[Defense R&D]

$66

Nondefense Discretionary

$517

[Nondefense R&D]$63

Social Security$1,026

Medicare$633

Medicaid$423

Other Mandatory$714

Net Interest$566

Composition of the FY 2017 Budget?outlays in billions of dollars

Source: Budget of the United States Government FY 2013.© 2012 AAAS

Emergent Budget Tendencies

Discretionary spending tends to be constrained… Early 1980s: nondefense constraints under Reagan

Late 1980s/early 1990s: spending caps

2011 Budget Control Act caps

While mandatory spending tends to grow Health care costs

Expanding beneficiaries, aging population

Medicare Part D, Affordable Care Act…

…versus failed efforts at control/constraint/reform

And, of course, anti-tax politics

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

Federal R&D in the Budget and the EconomyOutlays as share of total, 1962 - 2014

R&D as a Shareof the FederalBudget (LeftScale)

R&D as a Shareof GDP (RightScale)

Source: Budget of the United States Government, FY 2014. FY 2013 data do not reflect sequestration. FY 2014 is the President's request.© 2013 AAAS

*Keep in mind… Department of Defense technology development

activities have declined a little more than everything else

Enter FY 2014: Admin R&D Priorities Clear shift from D to R

And from Defense to Nondefense

Science + Innovation COMPETES Agencies

Advanced Manufacturing

Translational Medicine

Clean Energy + Environment

Defense technology cuts

STEM education

-14.8%

-8.2%

-7.8%

-7.3%

20.2%

66.5%

88.4%

-40% -20% 0% 20% 40% 60% 80% 100%

Defense Activities

Agriculture

Health (NIH)

Environment Agencies

General Science (NSF, DOE SC)

Commerce (NIST)

Applied Energy Programs

R&D Changes by Function Since 2004percent change from FY 2004 to FY 2014, in constant FY 2013 dollars

Source: AAAS Research and Development series, OMB R&D data, agency budget justifications and other budget documents. Select DHS programs were categorized in Defense and General Science in prior years; the above data have been adjusted for comparability.© 2013 AAAS

The biggie for R&D: Returning discretionary spending to pre-sequester levels Every agency would receive major increases above FY13

Approps: What Have We Learned? Everybody still mostly likes science

and innovation funding… Though to varying degrees

But again, fiscal politics trumps all

Current Politics: The “Pong” Model?

Cut nondefense spending!

Raise revenues!

The science and innovation budget

Obviously, a very facile oversimplification…!

Some concluding thoughts… If increasing aggregate R&D is the goal…

Should the sci & innovation community take broader fiscal view?

Science as % of discretionary? Discretionary as % of total?

Social spending is popular. Responsible taxation is unpopular How to grapple with tradeoffs

If we’re to ask more of the taxpayer: Should science programs more directly tie to public outcomes?

Temporal problem: allocative spending and tax policy is about past & present, science and innovation spending is about future

The alternative: Glide along happy with what we’ve got?

Notes about shutdown… Intramural vs. extramural vs. contractors

i.e. ARS/NIH vs. universities vs. JPL

Impacts: radio telescopes; Antarctic station; meetings and symposia

Clock is ticking for some big-ticket items

A transient event, one hopes

For more info…

[email protected]

202-326-6607

www.aaas.org/spp/rd/