Review of the annual report on the Federal research and development program, fiscal year 1976

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Review of the annual report on the Federal research and development program, fiscal year 1976 special oversight report no. 1
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Serial no. 94-II
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v, 31 p. : ; 24 cm.
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English
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United States -- Congress. -- House. -- Committee on Science and Technology. -- Subcommittee on Domestic and International Scientific Planning and Analysis
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Research and development contracts -- United States   ( lcsh )
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Statement of Responsibility:
Subcommittee on Domestic and International Scientific Planning and Analysis of the Committee on Science and Technology, U.S. House of Representatives, Ninety-fourth Congress, second session ... April 1976.

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University of Florida
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Full Text
-L J-


[COMMITTEE PRINT]


REVIEW OF THE ANNUAL REPORT ON THE
FEDERAL RESEARCH AND DEVELOPMENT
PROGRAM-FISCAL YEAR 1976




SPECIAL OVERSIGHT REPORT NO. 1




SUBCOMMITTEE ON
DOMESTIC AND INTERNATIONAL
SCIENTIFIC PLANNING AND ANALYSIS
OF THE

COMMITTEE ON
SCIENCE AND TECHNOLOGY
U.S. HOUSE OF REPRESENTATIVES
NINETY-FOURTH CONGRESS


SECOND SESSION
Serial II


AU'
lAUG 197

iiTS .


APRIL 1976


Printed for the use of the Committee on Science and Technology

U.S. GOVERNMENT PRINTING OFFICE
6"-811 WASHINGTON : 1976



















COMMITTEE ON SCIENCE AND TECHNOLOGY

OLIN E. TEAGUE, Texas, Chairman


KEN HECHLER, West Virginia
THOMAS N. DOWNING, Virginia
DON FUJQUA, Florida
JAMES W. SYMINGTON, Missouri
WALTER FLOWE RS, Alabama
ROBERT A. ROE, New Jersey
MIKE McCORMACK, Washington
GEORGE E. BROWN, JR., California
DALE MILFORD, Texas
RAY THORNTON, Arkansas
JAMES H. SCHEUER, New York
RICHARD L. OTTINGER, New York
HENRY A. WAXMAN, California
PHILIP H. HAYES, Indiana
TOM HARKIN, Iowa
JIM LLOYD, California
JE ROME A. AMB RO, New York
CHRISTOPHER3J.'DODD, Coanecticut
MICHAEL T. BLOUIN, Iowa
TIM L. HALL, Illinois
ROBERT (BOB) KRUEGER, Texas
MARILYN LLOYD, Tennessee
JAMES J. BLANCHARD, Michigan
TIMOTHY E. WIRTH, Colorado


CHARLES A. MOSHER, Ohio
ALPHONZO BELL, California
JOHN JARMAN, Oklahoma
JOHN W. WYDLE R, New York
LARRY WINN, JR., Florida
LOUIS FREY, JR., Florida
BARRY M. GOLDWATER, JR., California
MARVIN L. ESCH, Michigan
JOHN B. CONLAN, Arizona
GARY A. MYERS, Pennsylvania
DAVID F. EMERY, Maine
LARRY PRESSLER, South Dakota


JOHN L. SWIGERT, Jr., Execuivfe Director
HAROLD A. GOULD, Deputy Director
PILUP B. YEAGER, Counsel
FRANK R. HAMMILL, Jr., Counsel
JAMES E. WILSON, Technical Cbnsultant
J. THOMAS RATCHFORD, Science Consultant
JOHN D. HOLMFELD, Science Consultant
11 RALPH N. READ, Technical Consultant
I f *ROBERT C. KETCHAM, Counsel
4r REGINA A. DAVIS, Chief Clerk
MICHAEL A. SUPERATA, Minority Counsel
I __
I *


I.


SU.COMMI-TTEE ON DOMESTIC AND INTERNATIONAL
PCJENTIFIC PLANNING AND ANALYSIS


RAY THORNTON, Arkansas, Chairman
ROBV&T'A? ROE,'.New Jersey JOHN B. CONLAN, Arizona
DALE MIL1FO'RI; Texas JOHN JARMAN, Oklahoma
JAMES R.SCHEUFR, New York GARY A.MYERS, Pennsylvaiiin
HENRY A. WAXMAN, Califcrnia
JEROME A. AMBRO, New York
JAMES J. BLANCHARD, Michigan


SUBCOMMITTEE STAFF

JOH-4 D. HOLMFELD, Science Consultant
DARCIA D. BRACKEN, Science Cmnultant
JAMES L. GALLAGHER, Minority Technical Consuliant
(11) ... *


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LETTER OF TRANSMITTAL


HousE OF REPRESENTATIVES,
COMMITTEE ON SCIENCE AND TECHNOLOGY,
Washington, D.C., April 27, 1976.
Hon. OLIN E. TEAGUE,
Chairman, Committee on Science and Technology,
House of Representatives, TVashingtan, D.C.
DEAR MR. CHAIRMAN: I am glad to submit to you our Subcommit-
tee's Special Oversight report on the review we have conducted of the
"Annual Report on the Federal Research and Development Pro-
gram, Fiscal Year 1976."
Science and technology has made a major contribution to our
nation's strength and to our people's well being, and since the end of
World War II the Federal government has played an increasingly
significant role in supporting the advance of science and technology.
We therefore welcomed the publication early last year of the first
comprehensive report on the Federal research and development pro-
grams. This report provides a useful overview of the entire Federal
effort in support of research and development. It not only includes a
breakdown of the research and development efforts in each depart-
ment and agency, but it also breaks new ground through the func-
tional or "cross-cut" analysis of research and development in such
important areas as energy, food, materials, and oceanography.
Yet, as our hearings on the report confirmed, there is room for
substantial improvement in this report if it is to serve as an annual
review of the nation's science policy. The present report includes our
recommendations for strengthening the annual report. With the ex-
pected enactment of the Science and Technology Policy bill and the
possible shift of responsibility for this report from the Federal Coun-
cil on Science and Technology to the new Office of Science and Tech-
nology, I believe that our review and this report are particularly
timely.
In the preparation of this report our Subcommittee had the assist-
ance of Ms. Carol Lee McBee from the Science Policy Research
Division of the Congressional Research Service. Ms. McBee attended
all sessions of the hearing and wrote the portion of the report entitled
"Summary and Analysis of Hearings."
Sincerely yours,
RAY THORNTON,
Chairman, Subcommittee on Domestic and International
Scientific Planning andI Analysis.
(inI)


















CONTENTS


Page
Letter of transmittal----------------------------------------------- in
Contents---------------------------------------------------------- v
Special oversight -------------------------------------------------- 1
Recommendations- ------------------------------------------------- 3
Summary and analysis of hearing------------------------------------- 7
Summary------------------------------------------------------ 7
Background and scope of hearing-------------------------------- 8
Analysis of hearing--------------------------------------------- 9
Status and trends in the Federal R&D program .__------------- 10
The decline in R&D funding levels----------------------- 10
Erosion of the U.S. technology lead----------------------- 10
Priorities in the allocation of R&D dollars----------------- 12
Federal policies as disincentivesi to industrial R&D_--------- -13
Inconsistent regulations ------------------------------ 13
Influence of regulations on the character of industrial
R&D------------------------------- ------------ 13
Patent policies ------------------------------------ 14
Tax structure-------------------------------------- 14
Government procurement policies- ------------------- 14
Availability of venture capital------------------------ 15
Transfer of research results and technology ---------------- 15
Transfer mechanismsn------------------------------ 15
Private sector users--------------------------------- 15
Local government users------------------------------ 16
Technology transfer to and from other nations ---------- 16
Is there a Federal monopoly on basic research?------------ 17
Capsule view of status and trends ----------------------- 18
Comments on the FCST report and suggestions for improvement- 19
The Federal Council for Science and Technology ----------- 20
General evaluation of the FCST report-------------------- 20
Content improvements---------------------------------- 21
Format/style improvements- ---------------------------- 22
Capsule view of the FCST report ----------------------- 23
Suggestions for special oversight priorities for the DISPA sub-
committee---------------------------------------------- 24
Suggested policies or projects for DISPA ------------------ 25
External reviews ------------------------------------ 25
Internal reviews ----------------------------------- 26
Other special oversight projects- --------------------- 27
Formation of a national science policy--------------------- 28
Capsule of special oversight priorities ------------------------ 29
Appendix-List of witnesses ---------------------------------------- 31
Wv)





















SPECIAL OVERSIGHT


Research and development is conducted throughout the Federal
Government. Most agencies and departments support research and
development to further advances in those fields of science and tech-
nology which are related to their mission.

In the House of Representatives these research and development
activities are reviewed individually by a number of standing Com-
mittees having jurisdiction of the various programs, agencies, and
departments. Beginning with the 94th Congress, the rules of the
House provide that a continuing review of the entire Federal re-
search and development effort be done. For this purpose the Com-
mittee on Science and Technology is charged with the function
of Special Oversight in this area. Rule X, paragraph 3 (f) provide;
that "The Committee on Science and Technology shall have the
function of reviewing and studying, on a continuing basis, all laws,
programs, and Government activities dealing with or involving
non-military research and development." This Special Oversight func-
tion is to be performed in addition to the legislative and direct over-
sight function of the standing committees.

The review and the recommendations included in this report are
made pursuant to this special oversight provision of the House rules.
(1)




















Digitized by the Internet Archive
in 2013














http://archive.org/details/reannualre00unit












RECOMMENDATIONS
The Special Oversight hearings* covered by this report were held
for the purpose of reviewing the "Report on the Federal R & D
Program-FY 1976" prepared by the Federal Council on Science
and Teclmology. As part of this review the Subcommittee examined
three related questions: 1) The status and trends of the Federal
R & D program, 2) ways of improving the annual report so that it
will better serve a- a review of Federal R & D activities, and 3) other
possible and important areas of Special Oversight activity which
the Subcommittee might undertake. The specific recommendations
in this report are limited to the second of these questions.

The Subcommittee, having reviewed the report "Annual Report
on the Federal Research and Development Program, Fiscal Year
1976" issued by the Federal Council on Science and Technology and
the testimony received in public hearings on that report makes the
following recommendations for the improvement of futiire annual
reports on Federal research and development:

RECOMMENDATION 1
THE FEDERAL RESEARCH AND DEVELOPMENT EFFORT SHOULD BE
REVIEWED NOT ONLY THROUGH ITS INDIVIDUAL COMPONENTS
BUT ALSO AS A WHOLE
Science and technology is one of America's chief assets in a
rapidly changing world. Yet we have not developed an ability
to take a comprehensive overview of the nation's science and
technology. We continue to view science and technology as a
large number of unrelated projects and programs. The re-
search and development budget is largely an after-the-fact
aggregation of individual agency and department activities.
We must develop an ability to view the research and develop-
ment budget in its entirety so that the total national effort
can be evaluated.

RECOMMENDATION 2
THE REPORT SHOULD RELATE SPECIFIC SCIENTIFIC AND TECH-
NOLOGICAL ACTIVITIES SUPPORTED BY THE FEDERAL GOVERNMENT
TO PARTICULAR NATIONAL GOALS
Research and Development is not done in a vacuum. Each
research or developmentt project ultimately iS pursLed only
because it is expected to contribute to the achievement of a
societal goal. The societal goals to which the research and
*U.S. House of Rprresentatives. Conindttee on Science and Technolo;-y. Niniety-FoniirtIi
Congress, No. 14. SIiticonimittpe on Domestic antl InternatlOi I Soni.iie tiic l'l: 112[ iig, ;i1.l
AiiiualIyis. Spetcial1 Ovrsight Hearing on Annwiil Report on 'fcdcrail i'i u-~ic (i un 'l -ti luip-
ment 'rroyratm Fist l Year 197'6, .J iniw-July 1975.


(3)


G3-SI1-73-- 2








development activities of the Federal government are
directed should be made explicit in the report. In order to do
this, new and better ways of relating science and technology
to the national welfare should be developed and incorpora ted
into the report.

RECOMMENDATION 3
THE DESCRIPTION OF CURRENT RESEARCH AND DEVELOPMENT
ACTIVITIES AND THE RESOURCES DEVOTED TO THEM SHOULD
BE MATCHED IN THE REPORT WITH AN ANALYSIS OF THE Ex-
PECTED RESULTS AND THEIR USE
Our understanding of the impact of research and develop-
ment activities is limited by the strong focus on measurement
in terms of direct dollar expenditures and specific ongoing
departmental and agency programs. Efforts should be made
to develop a broader perspective and a better understanding
of how the products of scientific and technical efforts can
yield results which contribute to the solution of specific
problems.
RECOMMENDATION 4
THE REPORT SHOULD INCLUDE AN INDICATION OF PROGRESS
BEING MADE TOWARD PARTICULAR GOALS
The report, in some parts, seems to confuse functions with
goals. It should focus not only on the research and develop-
ment process, important as it is, but also on the advances
being made and their relationship to the accomplishment of
each goal. The end user, or potential end user, should be
identified, and the implications of success or failure of
research and development activities should be made more
explicit in the report.

RECOMMENDATION 5
THE REPORT SHOULD INCLUDE AN ESTIMATE OF THE FEASIBIL-
ITY OF ACCOMPLISHING EACH MAJOR RESEARCH AND DEVELOP-
MIENT PROJECT WITHIN THE TIME AND RESOURCES AVAILABLE
The usefulness and therefore the priority given to most
research and development projects is strongly influenced by
the timely availability of the results and the total resource
requirements needed to obtain those results. To permit an
evaluation of changing priorities the report should, on an
annual basis, provide estimates of the completion date and
the cost, manpower and other resource requirements needed
to complete each major research and development project.






5

RECOMMENDATION 6
MEASURERS OF RESEARCH AND DEVELOPMENT PRODUCTIVITY
SHOULD BE DEVELOPED AND INCORPORATED INTO THE REPORT
While measures of research and development productivity
may not be meaningful when applied annually, for periods
longer than a few budget cycles it should be po-sible to
measure the benefits obtained from research and develop-
ment investment so that the societal return can be indicated.

RECOM\MI\1ENDATION 7
A DISTINCTION BETWEEN DIRECTED AND UNDIRECTED BASIC
RESEARCH SHOULD BE MADE AND THE PRIORITY GIVEN BOTH
KINDS OF BASIC RESEARCH ACTIVITIES SHOULD BE MADE
EXPLICIT IN THE REPORT
The generation of basic knowledge is itself a national objec-
tive. However, little distinction is made in the report between
directed basic research, aimed at achieving a fundamental
understanding in the expectation that it may contribute to
the solution to a particular problem or set of problems, and
undirected research aimed at the generation of new scientific
knowledge for its own sake. This distinction should be made
in the report and the priorities given the research activities
within each category should be set forth.

RECOMMENDATION 8
THE REPORT SHOULD INCLUDE A PROJECTION OF ESTIMATED
NATIONAL OPPORTUNITIES AND NEEDS AND AN ESTIMATE OF
PROSPECTIVE FEDERAL EXPENDITURES FOR SCIENCE AND
TECHNOLOGY
It is now possible to take a step beyond the tactical, year-by-
year, crisis oriented approach that has characterized Federal
research and developments expenditures in the past. The
report should include an annual statement of longer-term
proposed research and development expenditures, their
purpose, impact, as well as their relationship to policy
objectives.
RECOMMENDATION 9
PRIVATELY FUNDED RESEARCH AND DEVELOPMENT SHOULD BE
COVERED IN THE REPORT TO PERMIT AN EVALUATION OF ITS
ROLE IN THE NATIONAL RESEARCH AND DEVELOPMENT EFFORT
In order to place the Federal res-curch and development effort
in perspective the report should include a discussion of in-
dustrial and other privately funded research and development
together with the contribution it makes to national scientific
and technological development. National science policy is not








just Federal science policy. Many important components of
the national scientific and technological enterprise are not
reflected in the programs funded by the Federal government.
The inclusion of privately funded research and development
should be in sufficient detail to provide a complete picture
of goals, trends, and current activities of the country.

RECOMMENDATION 10
THE EFFECTS ON THE NATION'S SCIENCE AND TECHNOLOGY Ac-
TIVITIES ARISING FROM REGULATORY AND OTHER INDIRECT IN-
FLUENCES SHOULD BE ASSESSED AND INCLUDED IN THE REPORT
The indirect effects of regulatory, monetary, patent and
other policies on the nation's science and technology enter-
prise are important. They may at times outweigh the direct
effects of research and development expenditures. Although
these causes and effects are more difficult to identify and
mea-ure they should be analyzed and discuss-ed in the report.













SUMMARY AND ANALYSIS OF HEARING*


SUMMARY
These Special Oversight hearings sought to gain an overview of the
general status of the national R&D effort and its implications through
a review of the "Report on the Federal R&D Program-FY 1976."
The subcommittee focused on the report of the Federal Council
for Science and Technology (FCST) dealing with the Federal research
and development program for fiscal year 1976 as a means to gain an
overview of existing Federal efforts. Since this report attempted to
consolidate available information and present a comprehensive
picture of the current programs in this area, the subcommittee asked
witnesses to comment on the contents of that report.
The subcommittee heaid from the witnesses that theie is a great
deal of concern for the health of our national R&D effort. Repre-
sentatives from industry, univeisities, and various govern meant
agencies/organizat ions expressed a variety of generally negative
views about the status and tiends of national direction in R&D.
Significant factors affecting the posture of R&D, as expressed by those
testifying, included:
A decline in the constant dollar support for R&D and thus posh.,ible
limitations on future programs; the subsequent erosion of the U.S.
world technological lead which could have important economic
ramifications; an apparent decline in the international prestige and
reputation of the U.S. concerning future research and development
areas; the increasing pressure nationally to apply existing govern-
mental R&D expertise to solve civil sector problems; the imposition
of conflicting or restrictive Federal policies (e.g., regulations, patent
policies, procurement procedures) which could hinder the freedom of
private R&D efforts; difficulties in effecting successful transfer of
technology developed in a research program to those who can and
should apply the knowledge and hence the perpetuation of a wasteful
time lag in usage; and, the indications of a trend toward Federal
monopolization of the basic research efforts in the U.S. for a variety
of reasons, a trend which could inhibit full creativity or innovativen'-s
in the future.
Although some witnesses attempted to soften this generally gloomy
outlook for tlie. national R&D picture, most witnesses did agree that
there were major problems to be considered. The role of Federally
supported R&D programs in the overall national effort was viewed
as certainly a significant, if not the most influential, factor affecting
the status of R&D.
*This Summary and Analysis was prepared by Dr. Carol LeeA Mcf'e. Selence Policy
Analyst. Science Policy Research Division, Congresi'iun.Ll Research Service, The Library
of Congress.
(7)








MoAt of the witnesses rated the report favorably but qualified their
positive comments with numerous suggestions for improvements.
Those testifying seemed to agree that the task of regularly compiling
such a document, which concerns a massive, diverse and generally
uncoordinated set of R&D programs, would require a great deal of
determination, perseverance and skill. Some indicated that first efforts
of this sort were not always satisfactory, or up to the standards that
could normally be expected after the benefit of many years' repetition
of the ta -k.
Many of the witnesses had suggestions as to how the format or
style of the report could be improved for greater clarity or readability.
Of more significance, however, was the general feeling that the selection
and subsequent treatment of contents for the report did not provide
comprehensive coverage of the Federal R&D programs. Some sug-
gested, for example, that indications should have been given as to how
various agency R&D efforts related, at the very least, to their agency
mission and preferably to national goals. Others felt that the report
should have outlined and assessed the individual agency's expertise
and capabilities for reaching their stated R&D goals. In addition, the
use of indicators other than direct expenditure accounting as a measure
of R&D efforts was advocated. Such indicators could include enumera-
tion of agency efforts in program evaluation, forecasting, demonstra-
tion programs, and so forth. In short, the witnesses felt that the first
FCST report, while representing a good start on a seemingly monu-
mental task, lacked somewhat in creativity and thoroughness. They
thought that subsequent reports would prove far more effective and
useful if content and format changes were instituted.
Finally, the subcommittee asked witnesses to suggest oversight
priorities as a guide to future subcommittee efforts. There was no
dirth of ideas in this area, and witnesses did not hesitate to present
their wide-ranging opinions, since all seemed to agree that a critical
overview of Federal R&D programs is long overdue. However, the
witnesses did not express any consensus of opinion on just what role
the subcommittee could play in its new oversight function. Views on
possible future directions for the subcommittee ranged from poten-
tially complex tasks, such as the formulation of a national science
policy, to the presentation of numerous projects of a much more
manageable nature. Most of the latter consisted of the initiation of
reviews o'r analyses on a variety of topics and included, for instance:
an examination of the interaction between Federal R&D activities
and those of the private sector; classification of all Federal R&D to
determine whether each effort contributes to agency mission or
national goals; and, identification of possible duplication in existing
Federal programs.
The witnesses seemed to agree that continuing and future Special
Oversight of Federal R&D programs would be highly desirable, and
could perhaps provide the neans for consolidating future efforts to
avoid duplication, misdirection, and overreaction, provide for more
complete evaluation, and maximize the use of limited funds.
BACKGROUND AND SCOPE OF HEARINGS
These hearings, held June 3, 4, 5 and 10, 1975 before the Subcommit-
tee on Domestic and International Scientific Planning and Analysis








(DISPA), were the first carried out under the new "Special Oversight"
function of the Committee on Science and Technology.'
As noted in Chairman Thornton's opening remarks, the subcom-
mittee, in carrying out the Special Oversight work assigned to it,
recognizes that much of the responsibility in this effort is shared with
other committees and subcommittees of the House, especially those
with legislative jurisdictions for the many individual parts of the total
R&D program. The subcommittee views the national research and
development effort as a delicate and diverse enterprise, involving
thousands of talented scientists, engineers and administrators. Al-
though he stated that "there is unquestionably a need to exercise
improved congressional oversight in this entire field," the Chairman
felt that sensitivity should be the watchword in these proceedings, so
that improvement, and not disruption, would be the end result.
Chairman Thornton felt that a useful contribution could be made
"by carefully reviewing the degree of planning and analysis which is
brought to bear on the Federal R&D program as a whole" (p. 2).2
Therefore, the subcommittee for its first hearings focused on the
"Report on the Federal R&D Program, fiscal year 1976" 3 compiled
by the Federal Council for Science and Technology with the assistance
of the Science and Technology Policy Office of the National Science
Foundation. This report provided the subcommittee with a basis for
an examination of current Federal R&D efforts and provided the
background for discussions with the witnesses of current and projected
trends in the scientific arena and the role that could best be filled by
the subcommittee in light of these developments and anticipated
national needs, and its responsibility for Special Oversight.
Specifically, the witnesses were asked to emphasize three aspects
of the Federal R&D program:
Status and Trends in Federal Research and Development,
Comments on the FCST Report including Suggestions for
Improvements, and
Priorities for the Special Oversight of Federal R&D Activities.
The subcommittee felt that testimony on these questions would help
develop a clear picture of the highly diverse Federal R&D enterprise
which has been evolving over many years.
Seven witnesses were heard in this first round of hearings, including
three representatives of industries with major R&D efforts, two
National Science Foundation administrators, one university pro-
fessor and one Executive department scientific administrator.

ANALYSIS OF HEARINGS
In this section the testimony of the witnesses who appeared before
the Subcommittee and the submitted, written statements are analyzed
and summarized according to the three major topics under
examination:
Status and Trends in the Federal R & D Program;
Comments and Suggestions on the FCST Report on the Federal
R&D Program, FY 1976; and
1 A complete witness list appears on p. 31.
2 All page references In this summary and analysis are to the printed hearing record.
$U.S. Federal Council for Science and Technology. Report on the Federal R&D Progrum.
FY 1976. (Washington. For sale by the Supt. of Docs., U.S. Govt. Print. Off.) 1975. Re-
printed as Serial K, Committee on Science and Technology, US. House of RcpresentatIves,
94th Congress, June 1975.






10


Suggestions for Special Oversight Priorities for the DISPA
Subcommittee
The testimony by all the witnesses on the individual issues has been
compiled and/or analyzed as to content and for clarity this portion
of the report isorganized according to these three categories.

STATUS AND TRENDS IN THE FEDERAL R&D PROGRAM
The decline in R&D funding levels
Almost all the non-industry witnesses addressed the question of
funding, i.e. dollar-support for R&D programs, and usually in
comparison with past years. Two of the witnesses (Ancker-Johnson,
p. 25 and Long, p. 47), while acknowledging a steady increase in Fed-
eral funding of R&D over the last decade, from less than $15 billion
in Fiscal Year 1965 to an estimated $21 billion in Fiscal Year 1976,
noted that in terms of constant-dollar support this actually represented
a 30 percent decrease in R&D funding. This lowering of actual sup-
port for R&D was by no means limited to the Federal efforts, since
this phenomenon has also occurred in the private sector (Ancker-
Johnson, p. 25). Such decreases in constant-dollar support indicated
an end to the "growth machine" for science in the U.S., signaling the
demise of the so-called "Golden Era". (Stever, p. 126).
The specifics of the funding decline were described by Dr. Long
who, nevertheless, thought our R&D picture was not so gloomy when
compared to other nations' R&D efforts.
In the United States, R&D expenditures increased rapidly from a fraction of j
percent in the mid-1940's to more than 3 percent [of the] gross national product by
the mid-1960's. Today, at about 2.3 l)ereent of a GNP exceeding $1 trillion, this
outlay remains large in relative terms and larger in absolute terms than anywhere
(ise in the industrialized world (pp. 46, 47).
The level of funding was mentioned as an indicator of the current
"health" of Federal R&D programs, While Dr. Long expressed his
view that the level of effort in the U.S. was large relative to other
industrialized nations, others felt that decreased funding, in combina-
tion with other factors, could lead to slippage of the U.S. position
in the world technological and economic hierarchy.
Erosion of the U.S. technology lead
Dr. Ancker-Johnson testified that decreasing support for R&D
in the United States may eventually lead to erosion of our tech-
nological lead abroad.
It is obvious that if our research and development cea;es to produce innovation
which in turn produces new products and new processes, then the problem of a
decrease in our positive balance of trade in the high technology industries will be
worse and we will have fewer and fewer products or processes which will be pur-
chased from abroad (p. 25).
Dr. Stever elaborated on this issue, stating that the competitive
position of our high technology industry in world trade had suffered
a recent decline in some sectors, and that our dominance had even
disappeared in certain other areas. He attributed this situation at
least partially to-
... the higher level of innovative effort abroad, foreign government financial
support for the development of products and of export markets for them, and
the heavy concentration of U.S. Federal R&D expenditures in space and defense
(p. 119).








The current decline, relative to other nations, in the growth rate
of labor and capital productivity for U.S. service and manufacturing
enterprises was, in Dr. Stever's view (p. 121), at least partially a
result of our decrease in R&D programs and is a threat to our in-
ternational competitive )position. This view was in agreement with
the conclusion of Dr. Ancker-Johnson that a decline in Federal support
for R&D would lead to decreased productivity and, hence, to an erosion
of the international market position for the United States (see quote
above).
The possibility that the reputation of the United States in the sci-
entific/technological areas had suffered recently on the international
front was explored by Dr.'s Long and Logsden (pp. 64, 65). The
changing perceptions of other countries, based on their own tech-
nological successes, were posed as one reason for this disillusionment.
This, accompanied by the discovery that the U.S. is fallible in some
areas, and the observation that our efforts often appear to be frag-
mented and uncoordinated, accounts for most of the decline in
reputation.
In reference to the fragmentation issue, the quest ion was raised
whether the United States should pursue a course of increased central
planning in its R&D efforts since many highly successful areas of
technology have developed without such guides. In respon se, Dr.
Long (p. 65) summarized a possible approach to future national R&D
efforts which might improve our productivity and reputation simul-
taneously. This approach would "point to a middle vway between more
central planning and continued pluralized effort in which each center
of activity pursues its own objectives" (p. 68).
In contrast to some of the positions presented above, at least two
of the witnesses gave the scientific and technological communities in
the United States a clean bill of health. Dr. Sairett doubted whether
our position or capabilities in basic academic science had deteriorated
at all. He thought we still pos'essed the capability to "lead the world".
(Sarett, p. 94). Dr. Drew recognized that the leveling-off of growth
rate for the scientific community in the late sixties had indeed catalyzed
some "serious dislocations" in the system, the aerospace industry
providing the most vivid example of this effect. It was his belief,
however, that some of the concerns voiced within the academic
science community about the health and strength of the scientific
enterprise were "overstated" and that worldwide comparison of U.S.
technology in essentially every field today placed ius in the forefront.
(Drew, p. 6).
The developing countries influence our world leadership in tech-
nology-based areas in two ways, and both were mentioned by Dr.
Stever. The first effect, takes the form of-
. shifting international patterns of industrialization exemplified by the plans
of the OPEC countries to acquire the technology that will permit them to develop
vertically integrated industrial economies bnqed on exploitation of their petroleum
resources . (p. 121).
The second influential factor revolves around-
. the attack on prevailing international protocols and industrial practices ILd
by the developing countries and directed toward major reviyions of the traditional
patterns of foreign investment and technology licensing by U.S. linns. Unlplezs
mutually acceptable accommodations ,can be found, these pressures may ulti-
mately lead to an effective elimination of our world leadership in many technology-
based areas (p. 121).
65-811-76-3






12


It might be noted that, although another of the witnesses, Dr. Healey
(p. 76), thought that R&D productivity had been seriously affected in
recent years, he. attributed this trend to inflation in the price of raw
materials and energy, --hortages of material and energy resources, and
escalation of efforts to deal with Government regulations. He did not
mention the decline in dollar-support for R&D programs as a factor,
nor (lid his testimony address the question of whether, in his opinion,
such an R&D productivity decline would have an effect on the U.S.
technological position.
Priorities Mi the allocation of ER&D dollars
Although several of the witnesses recognized that the support
level for R&D activities in this country has certainly declined in con-
stant-dollar terms, they disagreed as to whether this has contributed
to a slip in technology-dominance internationally. However, the wit-
nesses did agree that a shift in allocation of the dollars available has
occurred, with the percentage of Federal support for civil sector R&D
increasing substantially. (Drew, p. 7; Long, p. 47 and 57; Stever, p.
123; Ancker-Johnson, p. 28). The basic Federal policy in recent years
has been to aid in the solution of a wide range of domestic, civil prob-
lems such as urban transportation, food production, and crime control
and prevention. Dr. Stever emphasized the importance of R&D in
the "soft sciences", adding that their pursuit was difficult since "we
don't have the long-term traditions, and it's harder to meet the sub-
ject scientifically" (p. 116). The fact that civil R&D problems might
in fact prove "more challenging than putting a man on the moon" was
noted by Dr. Drew, (p. 7) who also suggested that old methods for
R&D might prove ineffective when applied to the complex societal
interactions involved in civil problems:
This added complexity of many of the civil sector problems calls for new manage-
mnent approaches tand a better mix between Governiment and private sector support,
and involvement and better understanding of the social aspects as well as the
physical science and enigiineering aspects of the problem . (p. 7.)
The increasing importance of civil R&D problems would seem to
account for the switch in emphasis recently from military dominance
of the Federal R&D budget to non-military efforts. There was some
disagreement on the extent of this shift, however. One witness said
that the civilian share of Federal R&D (dollars now :lightly exceeds
the military share (Ancker-Johnson, p. 28), while another stated
that, "defense and space R&D still take the lion's share of expendi-
tures" and that in the current budget "the defense share is again
increasing" (Long, p. 57).
One result of the increasing Federal commitir-cit to civil R&D has
been more public awareness of the amount of support that such efforts
require. As a. result the general public "increasingly questions the
rationale for that commitment" (Long, p. 57). Questions which might
naturally arise would concern the necessity for certain research ven-
tures; whether overlap exists among the diveirse Federal agencies
conducting research; doubt as to what level of expenditure is justified;
and fear about environmental, health and/or occupational dangers
which result from a particular R&D effort. The public's concern about
the dangers haas led, more recently, to the establishment of a number
of Federal regulatory policies which can affect R&D programs.








Federal policies as disincentives to industrial R&D
Some of the witnesses expressed the opinion that Federal regulatory
requirements loom as the single largest disincentive to industrial
R&D in the nation. Among the Federal policies mentioned as possibly
detrimental to private sector R&D efforts were: inconsistent regula-
tions (Throdahl, p. 98), influence of Government regulations on sub-
ject matter for R&D (Fusfeld, p. 74; Stever, p. 118; Healey, p. 76),
patent policies, (Fusfeld, p. 74; Sarett, p. 92; Ancker-Johnson, p. 33),
tax structure (Fusfeld, p. 7-1; Ancker-Johnson, p. 26), and Govern-
ment procurement procedures (Ancker-Johnson, p. 26, p. 32). Two
other topics mentioned in this light were not necessaril1y singular to, or
the total responsibility of, the Government: inflation (Ancker-
Johnson, p. 26; Healey, p. 76) air] availability of venture capital,
(Ancker-Johnson, p. 26; Thrw!afhl, p. 109; Stever, p. 119). Rather
than speak in terms of "disincentives". Dr. Stever chose to discuss
those Federal policies whlich could be used as "incentives" to industrial
R&D. Among these were dollar-investment, regulations, and educa-
tion (p. 132). Individual views on the above topics follow.
Inco asis te n t Rqg la t wons
Dr. Throdahl concentrated on this topic, suggesting that the
syndrome of incon-istency was characterized by two symptoms:
fragmentation and erratici-nm. iHe felt that not much could be done
about. the fragmented nature of Governm[tent regulatory efforts since
different treatment for different -ituations would be jw ified (p. 98).
On the second symptom, however, he stated that-
agencies exhibit erratic re,.ponses to findings wieh -cem to di.-close the
existence of a threat to licalth, and somn-tirn~i the o-ten.-ibly fendingg product is
immediately proscribed; and sometime- a more rational course of careful exarnina-
tion of the threat. and it, confequencWQS is follk'Wed.
. the most erratic agency responvcs usually occur, by our HiAS, as a result
of the premature relea-e of preliminary :ita. engineered by urne speciall interest
group in order to obtain a public r -p 'rye to force ;ioeincy action
If we could expect the ngenci's c; 'nist'ntly to tuke (xtrivme positions with
regard to healLh matter., we would do what. se''ms nuec-.;irY to prepare for thik
kind of action. But since they don't d for this eventuality are wai-ted . .
It's the incon(:i .'-i-eBcy that hurts, and tlhO iV Fini -tenc% wa-t,; 1'0uTeQ 0 1cau-0
we must prepare in adv.mce for what we think would be the 'Wi 'r-t c-e, inclf ad
of planning to follow a mnre mmaziir'i" course of r'p'on-mr to att-:c1: t lio probIili
(P. 9,S).
To remedy the situation, Dr. TlirodIlil recommended tliat ''"strontz
sanctions be placed on Fe'lerei rrcrniitory :mgenci's to act in the spirit
of consistency" (p. 9S).
JInluence of irol(iu(a>it on th('Ci'iarct( r/f Jhd&'i ' This subject was covered most thoroughly by Dr. Fui-fclid who )ob-
served that. wihl e the. objective- of llio-p nre2:ubl story at*eiHcieu ( concerned
with environment, -afefy, con imer protection and -o on, wcr w orthy
they "also result in shifts within the md (i-trial roc-arch -trictiiueh aid
thus raise questions as to whether we are 4till free to allocat(' oulr1
R & D resources for the mino-t elective contributionis to our economy"
(p. 74). He estimated tim t ,aiiijor (C10!pwl)1iol 01 wtSre i( ciurni&iiti(ly dev'ot ill
the following percentfiz-< of tfleioi* lK10 M '.o1t) to Rl) work wlhicl
is done in response to Goveniinct ]\":1liht t3'0! textile e- 30 to 40
percent; mining, 30 to 40 percrnt; mid tultmnobille-, uit)p to 50 percent.









Our economy has been strengthened by the ability of industrial research to
allocate its resources in accord with the criteria of good technology and good
economies. The desire to meet national objectives exemplified by the regulatory
agencies may result in an unintended and undesirable decrease in the industrial
research needed for other urgent national objectives (p. 75).
Dr. Fusfeld recommended that a review of this regulatory-induced
subject imntter selection for industrial R&D might be in order to
determine its possible effect on national science policy.
Dr. Stever also addressed this issue:
. the private sectors spend a large percentage of their own dollars, just
responding, not directly to doing Government R & D, but to this Government
regulation. I'm not against Government regulation, but I think we have to be
very careful of the side effects.
Somebody once mentioned that since we now require agencies and industry,
and everybody else to provide environmental impact statements on the new
applications of technology, perhaps we should provide impact statements on the
total R & D effect of a new regulation, or law, or rule. Let's be responsible all
around (p. 118).
Patent Policies
Dr. Sarett addressed the problem of patent lifetime, especially its
current shortness with respect to the required development time for
major new drugs.
In 1962 the development time for a newv drug, from the time a new drug candi-
date was? selected until the time it came to the marketplace, was about 2 years.
It now runs, in all of its development phases including regulatory review and
approval, up to about 7 or 8 years, or even longer up to 12 years, in fact, at the
extreme end.
The legal lifetime of a patent is 17 yearn. During the 1950's and into the 1960's-
a period in which the industry, I think, was very productive with significant
new drugs-the effective patent lifetime of a new and significant innovation was
13 to 15 years. Today, after the patent is issued, the development time has in-
creased and has eaten into that. Thus, if you take the extreme end of
the spectrum-where development occurs over a period of 12 years, and the
patent is issued at the beginning of the development period-there might be only
as little as 5 years of the patent life left. That 5 years of protective sales of that
drug is all that is left for the innovative company that developed the drug to
recover its investment, of course, not only for developing that drug, but for all
the drugs which failed, and all the other costs which go into research. Thus,
there has been a major impact in that sense, and it could be discouraging if
extended further. It could have the effect of a disincentive toward discovering
and developing new drugs (p. 92).
Dr. Ancker-Johnson emphasized that the private sector has a
major problem just dealing with the variety of patent policies now
in existence. She stated that there are 17 different statutes applying
to patents, plus many individual rnlfes of separate agencies adding to
the confusion. She noted that the Government Patent Policy Com-
mittee is presently attempting to draft legislation on this issue since-
The view of the executive branch is that it is desirable to have one uniform
policy covering patents for the entire Government, given enough flexibility so that
such policy can accommodate to the different missions of the various departments
(p. 36).
Tax Structure
Although this was mentioned as a "disincentive" to industrial
R&D efforts, no elaboration was given in the testimony of witnesses,
and it was not specifically pursued by the Subcommittee.
Government t Procurem ent Policies
Dr. Ancker-Johnson mentioned this issue and stated that the
possible impact of government procurement policies on new, small
enterprises should perhaps be reevaluated.






15


Availability of Venture Capital
Dr. Stever presented some specific figures on this topic, testifying
that a recent study 2 of-
. the equity capital market, shows that the funds available for financing
small new technological companies-an important source of technological inno-
vation in the past years-declined from about -:350 million in 1969 to about $5
million in 1974 (p. 119).
One of the witnesses disagreed, however, stating that "many, many
dollars [were] available for investment" in venture efforts, "under the
right kind of circumstances" (Throdahl, p. 109).
Transfer of Research Resvlts and Tcch-nology
Many of the witnesses expressed concern about the lack of a syste-
matic way to transfer the knowledge resulting from federally sup-
ported R&D efforts to those who could best use it. The potential
users were identified variously as the private sector, local govern-
ments, and other technically developed nations.
Transfer Aie~chan ism s
Dr. Ancker-Johnson testified that "the process of technology transfer
from Federal R&D programs into the civilian marketplace has not
been very effective" (p. 26). She said that. the single operating transfer
mechanism is for defense and space R&D efforts where the only
customer for the. results is the Federal Government itself. The im-
portance of developing a proper, working transfer mechanism for
other areas as well, was emphasized in the following statement.
It is vital that this technology be used not only by the Government, but much
more importantly, by the private sector. To assure industrial use, we need to
understand better the mechanknis for technology transfer and the impediments to
it. We must plan all civilian R&D programs from the beginning with successful
transfer as the expected outcome (p. 26).
In further remarks, however, Dr. Ancker-Johnson said that she
thought, that a, good mechanism currently existed for the delivery of
scientificc and technological data into the private sector and throughout
Government in the form of the National Technical Information Service
of the Department of Commerce which collect. such data for dis-
semination (p. 26, 27).
Although Dr. Drew mentioned that there are "important Federal
efforts underway to improve the technology transfer from Federal
and industrial source. to the. local level," he did not elaborate as to
the specifics. He did indicate that the "receivers-" in the technology
transfer operation rather than the "senders" were in need of some
special attention (p. 13).
Private Sector Users
Dr. Ancker-Johnson stated that there often -eems to be a great
deal of difficulty in putting teclinical understanding into practice,
particularly when the. R&D results come from the Federal Govern-
ment. As an extimiple, she cited telecommunications technology
'Dr. Stever, in a letter to Chairman Thornton dated July 11, 1975, identified the study
as "SBIC/Venture Capital" published annually by S. M. Rubel and Company of Chicago.
He further noted that the figures shown in his submitted testimony (p. 124) were corrected
by his oral testimony.






16


which is available but relatively unused. She mentioned that televised
two-way communication, televised shopping, personalized enter-
tainment or educational programs, tailor-made news papers, and
electronic mail delivery were all possible (pp. 36-37). Dr. Ancker-
Johnson felt that the character of the particular technology deter-
mined whether or not the knowledge would be utilized and she also
brought attention to several recent studies about the transfer of civil-
ian-oriented, federally-funded R&D into the private sector for com-
mercialization (p. 37).
Dr. Throdahl provided an interesting analysis of recent high-
powered Federal effort in areas of applied research to solve immediate
problems.
Without fundamental understanding, applied research often resembles the
childhood ganm. of pin-the-tail-on-the-donkey. It is inefficient, it's seldom effective
and it often prod :ces some grotesque results instead of attaining the goal.
One of the lcs-"n.-- I think we've learned in indiiutry is that the subunit of an
organization that will practice the technology that is built up has to be involved
at a very early stage in its conceptual development in order to shape it to the
needs and the capabilities of that particular subunit, and we don't see the agency
funded by the Federal Government as being the ultimate user of the technology
in most cases. Therefore, they need an appropriate partner early in the solution
of these pragmatic problems. (p. 99.)
Congressnmni, Ambro, a member of the Subcommittee, expressed
his concern about a large Federal R&D effort in areas where there is
not an existing, viable industry waiting to use the results. He men-
tioned the Government's -pending of "millions of dollars [to develop]
efficient, economical solar capabilities" (p. 105). Dr. Throdahl suggest-ed,
in response, that "incentives" could be offered to the private sector,
perhaps in the form of a coMlortium between government and industry,
to alleviate thi5 type of situation (p. 106).
Local Government Users
Dr. Drew noted the diffu-iion of decision making responsibility at
the State and local level which hr.s created "a growing need for im-
proved utilization of science and technology on the local scene" (p. 13).
He discussed this later in his testimony as:
... the new federalism concept which has dispersed to local and State levels the
discretionary authority for the expenditure of sizable new funds. The planning
which is necessary on the local scene, the ability to tap the scientific and tech-
nological capabilities which exis-t in this Nation, are therefore of increasing
importance with the addition of that discretionary authority for expenditure of
funds which has taken place at the local level. (p. 19.)
Technology Tiaomjer To and Frow Other Nations
There seenied to be some ambivalence as to whether technology
developed in the United States. should be made freely available to
other nations. Although Dr. Ancker-Johnsoln and Dr. Sarett did not
think the technolouvy flow to such nations necessarily should be
stopped, they did think that the effects of the process should be
recognized and that the Fedcial Government might at least, consider
an examination of the issue. Dr. Ancker-Johnson examined the subject
in terns of econo(inics.
the transfer of technology developed in the United States to other tech-
nically advanced nations has an impact on our own economy. Witness the Japa-
nese/U.S. balance of trade involving Japanese products based largely on U.S.-
developed technology. What is the nature and magnitude of this impact and how
are its domestic effects distributed? What policies should the U.S. Government
follow, and what monitoring devices or controls, if any, should be established?
(p. 25).








Dr. Sarett stated that it was probably beneficial to have the free
transfer of scientific information throughout the community of na-
tions, with the exception of military or other information pertinent
to the national defense. He did offer the opinion that some attempt
should be made to "try to reverse the technological flow to be sure
that we take advantage of innovations. . overseas" (p. 95). When
questioned by the Chairman as to possible mechanisms for thi; proc-
ess, Dr. Sarett mentioned that scientists them-elves read inter-
national journals and attend universities or conferences in other
countries. Therefore, the network of information exchange at that
level was already established and functioning. He did --uggest that
the Navy's use of scientific attaches in other countries and the out-
posts established world-wide by multinational companies would be
other mechanisms to consider.
Is there a Federalmonopoly on basic researchi?
The possibility of an increasing federal monopoly on basic research
was another major issue raised by the witnesses, and seemed to
result from one of the issues di-cus.^ed specifically regulatory poli-
cies. Since the private sector devott-. a con-iderable portion of its
R&D resources to regulatory response, it was argued that the burden
for basic research support has now fallen to the Government itself.
Some of the witnesses expressed concern as to whether this would
result in the best utilization of talent to pursue innovative R&D
efforts. Dr. Stever observed:
... that the Federal Government almost has a monopoly in the support of basic
research now. The performance of basic research is largely in the universities, some
in industry. But we, the Federal Government, support the basic research in the
universities and in industry, and the rest of the S&T spectrum: the applied
research, the technology and the development of products, all the way from great
big systems like those for big aircraft to very small products. Support of the latter,
of course, is shared by the Federal and private sectors.
... the Federal role is very pouwerftll, and growing more powerful, and I think it
would be a very good thing to study that changing role in depth (p. 127).
In discussing trends in the R&D programs for the nation, Dr. Drew
testified that it was basic to U.S. policy that "each mission agency
conduct a basic research enterprise and support a basic research enter-
prise which is relevant to their mission need- but which is oriented
towards the production of new fundamental understandings in the
field" (p. 8). He did not share the view of Dr. Stever, however, that
such efforts were tending to become monopolistic.
Whether or not the Federal support of R&D wa-; becoming too
dominant did not strongly concern Dr. Throdahl. one of the industry
representatives, who recommended that "Federal support of basic
research should be strengthened and redirected, and it should not be
diluted . ." (p. 99). He, in fact, cited zomeno governmental action:which
in his view, have not been supportive of further basic research on thi,
part of the Government:
During the past 5 or so years, agencies which have traditionally siipported basic
research, . have increasingly been forced to divert. from such support to
emphasis on near-term application, ;n activiLN fur which they arC u-.ually ill
prepared. I cite the so-called Man-field amendment, which hai hain-trung support
by Defense of the basic research from which nPw appro.iches to nat ion.il security
would be derived. The RANN program, for anoIther, has diverted major National
Science Foundation funds and effort to ap)plied programs for v.-hich the Nat i)nal
Science Foundation, in our judgment, has little talent, and ii which the National
Science Foundation structure and procedures are inappropriate, and ret-ults have








been miniscule. A sound national program of basic research is essential to provide
the firm basis for new ideas and new technology that will be needed for break-
throughs in all areas, such as defense, space, health, environment, energy, the
economy, and, of course, indirectly, in the constructive solution of some key
social issues (p. 99).
A divergent view of the Federal impact on allocations of R&D funds
by the private sector was presented by Dr. Fusfeld in his prepared testi-
mony. He stated that the "generation of knowledge by Federal R&D
expenditures increases the reservoir available to industrial research.
The large Federal expenditures on basic research in the past 20 years
[have] probably been one factor in the decreased emphasis on basic
research by industry" (p. 75). Thus, Dr. Fusfeld seemed to indicate
that increasing emphasis on basic research in Federal efforts prompted
decreased efforts in that area by the private sector. This is certainly in
contrast with the other witness's testimony that Federal regulatory
policies forced the private sector away from the pursuit of basic
research.
Capsule view of status and trends
The non-industry witnesses tended to look at the trends in Federal
R&D in terms of funding levels. Two of these witnesses noted specifi-
cally that the level of R&D funding has decreased by 30 percent in
constant dollars, even though budgets have increased in actual, current
dollars. The effects of such declining support for R&D were viewed by
some witnesses as detrimental, significantly with respect to the status
of the U.S. technology lead in the world. Some of the witnesses stated
that lowered support for R&D could lead to decreased total national
productivity. Another of the witnesses attributed the current observed
decrease in the R&D productivity component, considered separately,
to other factors such as inflation, materials shortages, and Govern-
ment regulatory policies. In contrast, the two NSF representatives
testified that the U.S. capabilities in scientific and technological areas
had not deteriorated. Whether the international reputation of the
United States had suffered recently was discussed in some detail and
one of the witnesses suggested that more central planning in our
R&D efforts might improve this situation. Additionally, the influence
of developing countries on our world leadership position in technology
was emphasized.
A second funding issue covered in the discussion of R&D trends
concerned the allocation of R&D dollars. Most of the witnesses agreed
that Federal support for R&D to solve civil sector problems had in-
creased, with a corresponding decrease in the percentage of Federal
R&D devoted to the military. There was some disagreement on the
latter point, however. One witness noted that public awareness of
Federal R&D activities had increased since those activities often
involve, or affect, matters of public concern.
A major portion of the industry representatives' testimony on this
topic involved Federal policies which have served as "disincentives" to
R&D efforts in the industrial community. Among the policies men-
tioned were: regulations, tax structure, Government procurement
procedures, patent policies, and inflation. These comments were not
confined to the industrial community representatives, since other
witnesses often mentioned the possible major effects the Government
can have on the private sector, at least in some of the areas.








The transfer of IR&D technology developed in Government-
sponsored programs was also covered in some detail. It was felt that
with few exceptions, the mechanisms for such transfer are nonexistent
or are often inefficient. Almost all of the witnesses expressed some
opinion on this issue, although there was a spread of opinion as to
who the major users of R&D technology would, or should, be. Some
identified the most likely users as the private sector, specifically the
industrial community, who could translate such knowledge into useful
products and services. Others noted that local governments were in
need of such information in line with their newly acquired responsi-
bilities consistent with the policy of "new federalism'. Still others
testified that the most consistent users of our R&D technology have
been other technically advanced nations, and that the Government
should examine whether such unfettered transfer was healthy.
The status of Federal support for basic research efforts prompted a
variety of comments on the part of the witnesses. One person testified
that the Federal Government was monopolizing basic research and
that a study of the issue in depth would be in order. Other witne-ses
thought that support for basic research should certainly not be diluted
and should, in fact, be increased. One of the industry representatives
thought that increasing Federal efforts in basic research was allowing
industry to use its funding allocations for other types of research,
while benefiting from the Federal program results.
COMMENTS ON THE FCST REPORT AND SUGGESTIONS FOR IMPROVEMENT
The report on the Federal Research and Development Program for
Fiscal Year 1976 was compiled by members of the Federal Council
for Science and Technology (FCST) with assistance from the National
Science Foundation's Science and Technology Policy Office. The
budget. figures used in the document were taken from the Budget of
the United States Government as developed by the Office of Manage-
ment and Budget and from figures supplied by the individual agencies.
The report format provides for an initial overview of the trends in
Federal support for R&D and an analysis of the role of R&D in a
technologically based society. In this overview section a quantitative
picture of the large agencies' obligations for R&D over the last decade
is presented. The second part of the report summarizes the R&D
programs for individual agencies. Included are: the Departments of
Agriculture; Commerce; Defense; Health, Education, and Welfare;
Housing and Urban Development; Interior; Justice; State; and Trans-
portation; and the Energy Research and Development Admini.trntion;
Environmental Protection Agency; Federal Energy Adininistration;
National Aeronautics and Space Administration; National Science
Foundation; Nuclear Regulatory Commission; Smithsonitn Institiu-
tion; and Veterans Administration. A common format is not used in
this section, presumably because the individual agent cies provided
their own information. Some agencies present their R&D activities
by topic area concentrations while others break out, their activities
according to the activities of the bureaus or offices under the agency.
In some cases, budgetary figures for the fiscal years 1974, 1975 Mid
1976 are given, in others only the expected expenditures for fiscal year
1976 are indicated.






20


The final substantive section of the report deals with the significant
R&D activities which occurred in selected "functional areas." Nine
topics were selected for these cross-cutting analyses: Basic Science,
Climate, Energy, Environment, Food, Health/BioMedical, Materials,
Oceans, and Social R&D. The criteria for selection of these particular
topics was not mentioned. A note in the Introductory Notice of the
report says that the ". . functional analyses are provided to give a
better sense of real scale and character of Federal effort in selected
areas of national concern."
The Federal Council for Science and Technology
Dr. Granger, on the first day of the hearings, provided a brief over-
view of the FCST, noting that the Council, which has functioned
since 1959, ranks as one of the oldest surviving elements of the science
advisory apparatus (p. 8). He described the membership as including
the heads of the various technical agencies and the cabinet-level
departmental appointees responsible for science and technology. Dr.
Granger summarized the range of activities of the FCST as follows:
The Council concerns itself with two basic kinds of activity. One is to develop
common administrative approaches to problems cutting across the R&D activities
of all the Federal agencies, such things as patent policies, some aspects of procure-
ment policy, et cetera.
The other, which is quite different, is to provide a shelter under which the
technical agencies or technical community of the Government and the Science
Adviser can organize, monitor, and plan new and substantive programs of such
breadth and scope that they cut across the interests of many of the agencies.
For example, there is the Committee on Atmospheric Sciences, which is one of
the earlier ones and which includes many of the interests of NOAA, DOD, NSF,
and others. There is a Committee on Marine Sciences and Engineering and one
to coordinate the planning for the construction of major new facilities for astronomy.
We have recently formed a Committee on Materials. We have a task group on
Inadvertent Modification of the Stratosphere-IM OS-a problem of great
interest currently and a Committee on Water Resources Research (p. 9).
General evaluation of the FCST report
Most of the witnesses, in their general evaluations of this first
report, expressed favorable opinions about the efforts of the FCST.
However, there were a number of suggestions for improvements, and
some were more critical than others. The following examples sum-
marize the basic tenor of the comments: Dr. Ancker-Johnson, 1.... it
represents a good first effort," (p. 31); Dr. Long, . a useful docu-
ment ... If [it] is to be annual, it should issue from an agency equipped
with the capacity and the authority to do a first-class job" (p. 48);
Dr. Fusfeld, '.... an excellent start in the process of review and plan-
ning of the Federal R&D effort. . provides a solid starting point for
discussion" (p. 73); Dr. Healey, ". . applaud[s] the FCST for pro-
ducing an outstanding report. ... it will certainly serve as a valuable
reference volume" (p. 77); Dr. Throdahl, ". . a perspective of the
most important research needs is not clear to the reader of the [re-
port] . ." (p. 100); Dr. Stever, ". . I want to go on record to con-
gratulate Dr. Drew of my staff and the team that has worked with
him . this is one of the new things we did. ." (p. 116). In addition,
most of the witnesses offered suggestions for improvement of the
style, format, or content of the report. More detail is provided in the
following sections.








Content improvements
A variety of comments were presented about the contents of the
FCST report. Some suggestions would lead to a much broader scope
for the report. For instance, the suggestion that an attempt on the
part of the FCST to relate R&D expenditures of individual agencies
to their own missions or to national goals would require a much-
expanded analysis. Dr. Ancker-Johnson testified that her major
criticism of the report was that it did "not assess the effectiveness of
individual agency R&D [programs] in achieving national goals" (p.
32). In the same vein, Dr. Drew commented that greater attention
could be given to "the rationale and objectives which have played an
important role in decisionmaking within the various specific agency
programs, including greater analysis and overall interpretation of the
thrust of the program" (p. 11). Dr. Healey also concurred in this sug-
gestion, observing that the value of specific technical objectives in
relation to larger national goals should be judged "by the sponsor or
potential user of the program results" (p. 79).
Two other suggestions were made concerning the objectives of
R&D programs. Dr. Drew thought that future reports should attempt
to estimate whether agencies are utilizing their capabilities properly
in their R&D programs (p. 10). Dr. Healey recommended that esti-
mates be made of the feasibility of accomplishing stated R&D objec-
tives taking into consideration the availability of time and resources
(p. 79).
Dr. Long pointed out that the traditionally itemized categories for
R&D expenditure accounting, i.e. salaries, capital investment, cost of
experimental materials and equipment, may not be sufficient. He felt
that a significant amount of Federal expenditure that could be logically
included in such accounting was at present omitted:
This involves, for example, expenditures of agencies and departments for pro-
gram evaluation, economic and social forecasting, and design and experimental dem-
onstration of social programs. Whether or not this form of expenditure is con-
sidered direct, it seen's to us an increasingly important way in which skills and
techniques of the scientific community are applied to the achievement of social
objectives through government expenditures (p. 52).
He also suggested that indirect support of R&D through policies
and practices other than direct funding should be accounted for. He
noted that-
These devices are extremely varied, and include: regulatory and standard-
setting practices, procurement operations, tax and lending policies, trade and
monetary policies, economic policies, personnel policies, and education policies
(p. 52).
Dr. Long summarized his views on this issue: "Different measures,
and different ways of conceiving of the relation of science and tech-
nology to national well-being, would add considerably to the flexibility
and the sophistication of oversight and the coordination of R&D ex-
penditure" (p. 52).
Dr. Throdahl, in his prepared testimony, analyzed eight of the nine
functional areas and stressed their importance in future R&D efforts.
He did not include "Oceans" in his list of functional areas, but did sug-
gest the inclusion of five other categories: Fire Prevention and Con-
trol, Earthquake Forecasting, Transportation, Information Services,
and Planning. He further remarked that the current and projected ex-
penditures for social research seemed "excessive for what is being ac-
complished" (p. 103).






22


Other suggestions would involve some forecasting at the time of
report preparation. For instance, Dr. Healey thought that the report
should include some indication of how a developing technology could
be used,/either by the Government itself, or by the industrial com-
munity (p. 77). The Chairman questioned Dr. Drew as to whether
efforts should be made to determine the availability of scientific man-
power in different fields in order to avoid manpower shortages (p. 10).
In response, Dr. Drew acknowledged that such projections were indeed
useful and were certainly feasible. He did point out that manpower
reports are now issued by the Science Resources Services of the NSF
and that future FCST reports might "consider highlighting a few
selected aspects as they are relevant to the overall R&D program" (pp.
11-12).
Other types of additional material suggested for future reports
centered on the inclusion of the R&D efforts of other groups for com-
parative purposes. Dr. Fusfeld, for instance, stated that completeness
and perspective on a national scale could only be achieved by inclusion
of "the diverse and critical industrial research effort" (p. 73). Dr.
Drew thought that the objectives and achievements of the Federal
Council for Science and Technology itself should be considered in
future documents (p. 11). He also suggested that the inclusion of non-
Federal R&D investments, perhaps in a historical sense, and inter-
national R&D investments could improve the report.
Dr. Long summed up his feelings about the benefits to be had if the
FCST report were to be generally improved:
Several specific advantages would be gained by improving the quality and
regularity of annual R&D expenditure data: comprehensive dollar accounting
can improve knowledge of the direction and rate of changes in expenditures;
reporting in a common format will permit comparisons between agencies, and
between programs within agencies; expenditures associated with acknowledged
social goals can be carefully tracked; and expenditures might be more effectively
mobilized for particular, short-term policy goals.
These advantages are related primarily to the improvement of data for past
fiscal years. But we believe it is worth the effort required to collect data at the
time budgets arn being prepared for the next fiscal year. Only in this way can
changes in emph-sis or direction be submitted to the scrutiny of Congress and
other interested parties (p. 51).
Format 1/style improvements
Dr. Drew, who was closely involved with the production of the
FCST report, was the first to single out its shortcomings. He men-
tioned specifically that improvements in the accounting system would
be needed, so that the support supplied for a specific functional area
within the Federal R&D program could be extracted and double-
counting eliminated (p. 11). He also mentioned that there might be
more expansion and interpretation of the program areas presented.
The rest of his comments pertained to the contents of the report as
summarized in the preceding section.
Dr. Long provided the most comprehensive and critical comments
on the format and style of the report. He suggested that ". . a
more precise and rigorous attempt at comprehensiveness would
probably result in the addition of some agencies" (p. 48). He pointed
out that it was unclear whether or not any of the regulatory agencies
had been included at all. Further, he questioned the reliability of the
data presented:
Since the collection of data internal to each department and agency was pre-
sumably left to that department or agency to organize, there is no assurance








that all relevant programs and funds of component agencies were included. Given
some assurance as to the uniformity of criteria, we would be more confident of
the comparability of the numbers reported by different agencies (p. 48).
Dr. Long also said that the use of a common format for the presen-
tation of departmental and agency R&D expenditure:,, as well a"; a
common level of detail, would be desirable in future reports. As an
example of the confusion in the report, he pointed out that the figures
for DOT were grouped by objectives, those for HUD were grouped by
program, and the expenditures for HEW were organized categorically
within the department's three main subdivisions. He noted also that
for those agencies with expenditures of less than $100 million annually,
no comprehensive R&D expenditure data were given for the whole
agency, although the State Department gave expenditures for its
component agencies. The sparse attention given to the budgetary
details of the NSF programs was surprising to Dr. Long in view of
the NSF's responsibility for R&D data and its central role in the
Federal effort (p. 49).
In his analysis of the functional area presentations in the report,
Dr. Long noted that the nine selected topics conflict with the 12 func-
tional areas which have been used by the NSF for the p.9t three years
in its analysis of Federal R&D expenditures. He also pointed out that
budgetary data is provided for some functional areas and not for
others. Singling out the sections on Health/Biomedical and Basic
Science, he stated that "neither functional analysis provides better
data or different arrays than what is normally available from agency
budgets" (p. 50). Dr. Long also observed that-
verv different considerations miay be involved when analyzing a functional
area dominated by a lead agency as compared with a functional area that k
highly diffused in agency R&ID budgets throughout the Government. The use-
fulness of a functional approach may be much greater precisely in those cases
where there is no agency bearing the main responsibility (p. 51).
Dr. Healey recommended that the existing index could be improved
with more detail, and that the addition of a "glossary of abbreviations
would improve the report's usefulness as a reference" (p. 79). He also
suggested the greater use of charts to indicate the qualitative content
of agency programs and how they relate to national objectives (p. 79).
Capsule r'ew' of the FCST report
The FCST report, consisting of nearly 200 pages, was prepared by
the Federal Council for Science and Technology and covers the R&D
activities for Fiscal Year 1976. The. programs of nine executive depart-
ments and eight other agencies with R&D missions are included. The
report is composed of two major sections: the first gives details of
individual departmental or agency R&D programs, with some
budgetary detail, and does not have a common format; the second is
divided into nine functional areas, giving the various
contributions to R&D in those fields.
The witnesses generally rated the FCST report, favorably, although
most included some sub-tantive comments and suggestions for im-
provement of future reports. The suggestions ra nmId from IIt1o-00
dealing simply with format or style, to those critical of the content of
the report.
Comments aimed at content imlprovemnents were quite varied. A
few of the witnesses sugge-sed t iat the report -hould aunaily/e R )D
programs in terms of the potential achievenient of national goals.






24


One witness thought that, at the very least, each agency should give
an indication of how the R&D activity it supports fits into it's own
mission. Another testified that the capabilities of agencies to perform
the R&D in their programs should be a-ssessed, along with the feasibil-
ity of accomplishing stated objectives. The exclusive use of traditional,
direct expenditure accounting was declared insufficient by one witness,
who suggested expanding future reports to include assessments of
indirect expenditures. Possible items to be included in such indirect
funding accounting would be expenditures for program evaluation,
forecasting, and demonstration programs. Indirect support of R&D
through policies and practices, such as regulations, procurement pro-
cedures, tax structure, educational programs or standard-setting,
should also be included in future reports according to this same witness.
Another witness presented his own suggested list of functional areas,
expanding on the list that had been included in the current report.
Some suggestions were made that would require forecasting on the
part of the FCST in the areas of manpower shortages and the possible
uses for developing technologies. The industry representatives who
testified felt that the research efforts of the industrial community
should be included for comparative purposes. Others suggested the
inclusion of international R&D investments, although the difficulty
in obtaining these data in a timely manner was noted.
The following format and style improvements were suggested:
use of a better accounting system for dollar allocations; more compre-
hensive reporting; improved data reliability; use of a common format;
increased originality in data presentation; expansion of the index;
the addition of a glossary; and the inclusion of more charts.
One person stated that a high degree of congressional attention to
the report would be the best method to ensure its future improvement.

SUGGESTIONS FOR SPECIAL OVERSIGHT PRIORITIES FOR THE DISPA
SUBCOMMITTEE
The witnesses addressed a wide variety of issues in their suggestions
for possible priorities for the subcommittee in its new Special Oversight
responsibility for Federal R&D. Most of the individual possibilities
could be classified as separate 'projects' or 'policies' that could either
be advocated or initiated by the subcommittee. These ranged from
the undertaking of reviews of certain areas such as patent policy, the
legality of government-industry 'consortia', or the overlap in the total
Federal R&D effort, to the development of certain capabilities on
the part of the subcommittee, for instance the education of its mem-
bers as to stated goals of the Congress or individual agencies for R&D
priorities. A listing of these proposed projects follows, with some
elaboration as to the mechanisms for accomplishment of or rationale
for these tasks where provided. The concluding section summarizes
the preferences on the part of some of the witnesses to have the
subcommittee provide the focus for the establishment of a national
R&D program which would mesh with national goals, and the estab-
lishment of a new approach by the Federal Government to its R&D
role in the civil sector.






25


Suggested policies or projects for DISPA
A number of the witnesses suggested that the DISPA subcommittee
undertake reviews or analyses of certain i--tues or areas. Tihese took
the form of either internal reviews of mechanisms in the existing
Federal R&D system or external review- of other R&D systems.
External Reviews
Dr. Drew stated that the United States could profit from the review
of other nations' approaches to R&D planning and deci-nionimaking.
He elaborated on the systems represented by the Western European
countries, particularly those belonging to the OECD (p. 20), and on
the various systems of the Eastern Bloc countries, with their highly
structured planning and management approach to government re-
source allocation. Dr. Drew summed up hi--, views:
Some of them are of potential applicability in the United Statez. at lea;t
in some slightly modified form to respond to our governmental system. We
should, as a nation, be prepared to learn from others and to take from them the
best of their systems and be willing to adopt approaches which they may have
tried and may have found successful and which would work in our system.
What I am suggesting here is that I think we have clearly not arrived at the
ultimate system for the allocation of resources for research and development
on the Federal scene and we should be willing and in fact be quite open to the
prospect of learning from others (p. 20).
Dr. Healey recommended that "appropriate cognizance" be taken
of the industrial and other private sector R&D programs (p. 79),
since coordination of programs between the Government and industry
in such areas as product safety would prove useful (p. 81). He stated
that the "present climate of the Congress particularly discourages . .
the interaction [between industry and Government]" (p. 81). He felt
that many cooperative programs have been destroyed due to accusa-
tions that such efforts naturally lead to the captivity of an agency
by the industry involved (p. 81). Dr. Healey did say that a complete
survey of industry was not possible in itself, but that the subcommittee
could utilize Government agencies to obtain information about
individual industry activities. Dr. Sarett expressed his agreement
on this issue and noted that "congressional understanding and
acceptance of the essential role of industry research in the Nation's
total research and development efforts" was of critical importance
(p. 89). He especially pointed out that recognition should be given to
"industry's special role in the effective development of products
that serve a useful public purpose" (p. 89).
In his suggestions for the subcommittee's priorities, Dr. Long
discussed another subject external to Federal R&D funding, the
topic 4f manpower planning. He said that-
The Federal Government, having become, directly and indirectly, the major
employer of highly qualified scientists and engineers, bears a respon-ibility to
project requirements and patterns of skill utilization. Such projection-, could be
requested along with annual expenditure projection-, and viewed as a supplement
to budget data. In the longer term, manpower planning could add anotliir dimcn-
sion to the process of tracking, evaluating, and directing the contribution of P&D
to social goals (p. 52).
Specifically, Dr. Long recommended that the subcommittee under-
take a review of various efforts now underway aimed at better forecasts
and policy tools in the manpower area. He felt that the subcommittee
could assess the progress of these efforts and determine whether useful
results are being obtained (p. 52).






26


Dr. Stever suggested that the subcommittee look into the "different
attitudes" of the industrial R&D community, but for the purposes of
deciding what actions the Government could take to provide "incen-
tives" for R&D in innovative areas (p. 132).
Internal Review
Dr. Throdahl thought that all Federal R&D expenditures should
be ai-,igned priorities according to three policies:
The Committee on Science and Technology might well insist that each Federal
Government department intending to utilize Federal dollars for R&D develop
department or agency objectives and goals to achieve such objectives. These
objectives and goals would then become the basis for approved Federal R&D
funding, either intramural or extramural, along the following policies-there are
three of them-which are in selected fields which would be appropriate to the well
being of the Nation . (p. 97).
The three policies suggested by Dr. Throdahl are: mission R&D,
which may be highly uncertain and therefore costly, and which may
exceed the resources of the private sector; fundamental R&D that
would lead to a knowledge bank, freely available to the private
sector; and R&D projects leading to useful by-products, such as highly-
trained personnel (p. 97). Although Dr. Throdahl thought that these
three police. would be useful to the subcommittee in the matching
of funding dollars to Federal agency goals and objectives, he did not
suggest the relative importance of the R&D categories.
Dr. Long also thought a review' of proposed R&D expenditures
should be undertaken under the auspices of the Specitl Oversight
function. He felt that this; could be accomplished by instituting-
. the requirement by this committee of annual statements by an appropriate
executive branch agency-possibly a White House science advisory structure as is
currently being discussed-describing and analyzing proposed R&D expenditures
in the new budget. These statements should contain two kinds of material: (1)
they should define the ranges of new budget authority and outlays for the Fed-
eral R&D effort in such a manner that agency and departmental missions, as
well as major functional activities, can be assessed in relation to past and current
funding levels; (2) they should reflect the connection between economic, social,
and international policy objectives of the Government and proposed expenditures
(p. 54).
He stated that such action on the part of the subcommittee would
make it possible "to take a step beyond the tactical, year-by-year,
crisis-oriented approach that has characterized Federal R&D expend-
iture in the past. . the oversight function can develop into a
strategic overview of the interplay of R&D resources with existing
and emerging social goals" (p. 54).
Another type of review activity suggested by Dr. Healey concerned
the possibly wasteful duplication of R&D efforts in federally-funded
projects. He thought that the subcommittee should take steps to
"in.-;ure" that such is not the case (pp. 77-78).
Dr. Ancker-Johnson listed a number of review efforts that could be
undertaken by the subcommittee. Specifically, she felt that (1) the
process of technology transfer from Federal R&D programs should be
examined in detail (p. 32); (2) the economic and regulatory climate
for the creation of small, innovative technical enterprises in the
private sector needs analysis (p. 32); (3) the subcommittee could
develop data on the effects of inflation, regulatory policies, Govern-
ment procurement procedures, and scarcity of venture capital on the
creation of new' technological enterprises and could recommend ways






27

to encourage the start-up of such enterprises (p. 32); (4) an examina-
tion of the legal and institutional constraints to the formation of
industry-government or multi-company cooperative R&D programs
for the development of high-risk technologies could be undertaken (p.
32); (5) a review of the multi-faceted Federal patent policy was in
order (p. 33); and, (6) the subcommittee might address the use of
Federal technology policy and programs to enhance the growth of
productivity in the United States (p. 33).
Finally, a number of witnesses suggested that the subcommittee
should analyze Federal R&D efforts in the light of "national policies
and goals." These included Dr. Ancker-Johnson (p. 32), who thought
that the subcommittee should "make recommendations as to whether
the existing and projected non-military Federal research and devel-
opment programs are being responsive to the achievement of our
national goals"; Dr. Fusfeld (p. 74), who suggested that "exploratory
efforts be initiated to . provide an improved perspective on how
the total scientific and technical efforts of the country contributed to
overall national objectives"; and Dr. Healey (p. 77), who recom-
mended that the subcommittee "assess whether the Federal R&D
program is properly balanced in distribution and emphasis so as to
produce the science and technology required to meet the national
goals."
Dr. Healey stated that in order to accomplish this task the subcom-
mittee would have to undertake an educational process to "make sure
it is aware of the nonmilitary long- and short-range goals, both national
and international, as established by the executive and legislative
branches of the Government" (p. 77).
Other Special Oversight Projects
A number of other activities to be done by the subcommittee a-;
part of its Special Oversight function were suggested by the witnese,-s.
Dr. Healey thought the subcommittee should seek the advice of such
groups as the National Academy of Sciences and the Industrial Re-
search Institute on a continuing basis. He also thought that reassess-
ments of the feasibility of success of various R&D efforts should be
made on an annual basis (p. 78).
Dr. Long recommended that the subcommittee develop its capabili-
ties to serve as a "listening-post for trends in science, technology, and
their social and economic implications" (p. 56).
Two of the witnesses suggested that the subcommittee might make
recommendations for scientific policy impact studies which assess the
consequences or results of policy decisions. Dr. Logsden observed:
[these] techniques might be applied-perhaps covering 5-year periods-to large-
scale R&D activities not normally evaluated in the budgetary authorization or
appropriation process. For example, the progress of high-energy physics or ground-
based astronomy; the cost and effectiveness of peer review in the health-bio-
medical-or other-areas; methods of funding and monitoring Federal contrzict
research centers; and interagency mobility of R&D personnel-these suggest. the
kinds of impact and assessment studies we have in mind. This committee maiy be
the appropriate body to select them, while OTA should perhaps conduct them
(p. 53).
Dr. Stever was the other witness to address this issue. He noted thtlit
people who have studied the structure of science have suggested that.
better analytical policY studies that look into the future aie needed.






28


He also indicated that such studies should be part of the "action part
of our government, which includes the Congress, in each year's budget"
and he hoped "that this committee will always look to that part of its
role" (p. 130).
Despite the fact that the military side of R&D expenditure is not
included within the committee's oversight mandate. Dr. Long stated
that:
. we cannot conceal the conviction that there is on hard and fast line be-
tween the military and the non-military parts of the national R&D effort. It
would be a mistake not to acknowledge this fact and not to consider its conse-
quences . We hope that this committee will seek expert guidance, and will not
permit so important a subject to be ignored (p. 55).
Formation of a national science policy
Several of the witnesses testified that until the Nation had an
established science policy, the role of the subcommittee in its oversight
activities would be difficult to clarify. Dr. Fusfeld, for instance, felt
that any report on future Federal R&D activities should provide
answers to the following questions:
1. Is the division of effort among the various programs good or bad?
2. Are we making progress toward particular goals, and how do we measure
this?
3. Do we have good overall perspective of the relative contributions of Federal
and industrial R&D?
4. Can we relate the various Federal R&D expenditures to a set of missions or
functions that have definable endpoints, time tables, and a realistic estimate of
resources required for exploitation-capital, manpower and materials? (p. 73).
He explained further:
I can state explicitly what these questions imply. We need, and do not yet have,
some attempt at a national R&D program plan. We need to spell out as clearly as
possible the implications of success in our R&D and provide the mechanisms for
its exploitation. We need some sense of priorities (p. 73).
Dr. Sarett also addressed this issue, urging the subcommittee to
focus its attention on national science policy, not just the Federal
aspects. He noted the interdependence among scientists and scientific
institutions, both public and private, and urged "the reinforcement of
present instrumentalities and the creation of new ones to facilitate
the broader representation of science in the formulation of national
science policy" (p. 87). In fact, Dr. Sarett stated that "Congress
should concern itself with strengthening the mechanisms and incen-
tives insuring that scientific knowledge is applied toward the achieve-
ment of socially useful purposes" (p. 88).
Dr. Stever alluded to the formation of policy in his discussion of
the possible impact of the Federal Government on the national
R&D picture.
. the ultimate goal of the pursuit of technology, in the private sector as well
as Government, is to impact our economic and security interests and the quality
of life led by our citizens and, indeed, by the citizens of the whole world . this
subcommittee [has] a significant role[s] to play in these issues, since each impinges
directly upon the health of our national S&T enterprise and the ability of that
enterprise to serve our national interests. Specific questions of program directions
and priorities for the technical agencies are clearly involved, as is the appropriate
reach of the concerns of the science advisory apparatus, whatever form that may
ultimately take.
The Subcommittee on Domestic and International Scientific Planning and
Analysis most certainly has a central role to play in shaping the Nation's responses
to these problems (p. 122).








Dr. Drew analyzed the specifics of the formation of a national
policy for science in terms of funding, and explained the advantages:
In the field of R&D planning the United States has traditionally accepted the
concept that the dynamics of the current scene require a highly flexible approach
to R&D support and an annual decisionmaking process which could reflect
changing current conditions and priorities. In institutions such as universities,
however, the ability to respond to annual fluctuations in support for specific
program activities is limited by the nature of the institution. For many reasons
it would be highly desirable to have a somewhat more predictable future and a
certain stability in R&D funding support.
This potential conflict between the desire for better long-range planning and
greater predictability in terms of resource availability and the need to retain a
dynamic character to our R&D program presents an interesting challenge to the
executive branch and the Congress (p. 13).
The formulation of a national policy for R&D might result in
some changes in the Federal role in civil sector R&D. Dr. Drew, for
one, thought this would be advantageous, stating that "the health
of [the] industrial complex may require some rather new approaches
to the Federal R&D role in the civil sector. It may also require other
changes or incentives which are not direct R&D investments but
rather stimuli . such as modifications to the tax structure or
patent and licensing policies or the ability to perform cooperative
industrial R&D" (p. 12).
Dr. Stever predicted that the work of the subcommittee will-
. prove ever more important. It's going to be tough work because it's going
to deal with ideas, and concepts, and reasons behind the programs. It's always so
much easier to get down to the nuts and bolts of the budgets, or questions such as
is that project better than this one. But the fact is, in an endeavor as big and as
important as science and technology in our country . the Congress . the
administration, and people in the community of science and technology-just
have to address these general issues more, and understand them, and get the
reasons behind them (p. 115).
Capsule view of special oversight priorities
The range of suggestions from the witnesses for oversight priorities
of the Federal R&D effort covered a broad spectrum, from the estab-
lishment of a national science policy to a variety of fairly uncompli-
cated 'projects', such as the examination of various individual topics.
Most witnesses felt that the subcommittee could play an important
role in the planning of the increasingly complex national R&D effort,
although there was not a great deal of overlap in opinion as to just
what that role should be.
Many of the witnesses thought the subcommittee should initiate a
number of reviews or analyses as their initial step in the oversight
function. These could be classed generally as internal in nature, that
is, involving the review of some aspect of the existing Federal R&D
program in detail; or external in nature, concerning the review of
other, non-government R&D activities to determine their relation to
the Federal program. Suggestions for internal analyses were most
prevalent. They included: (1) determination of the relation between
proposed expenditures and economic, social, and international policy
objectives; (2) identification of duplication in R&D programs; (3)
examination of the technology transfer mechininisms for R&D results;
(4) review of the effect-- of current Federal policies on the creation of
new technological enterpri-es; (5) examination of the legal and insti-
tutional constraints on 'consortia' for the accomplishment of high-risk
R&D; (6) review of Federal patent policy; and (7) classification of all






30


R&D according to whether it contributes to agency mission or na-
tional goals. In the same vein, one of the witnesses suggested that all
Federal R&D expenditures should be assigned priorities according to
three possible R&D policies: mission R&D, fundamental R&D, or
R&D yielding useful by-products. In short, the witnesses seemed to
be in agreement that the Federal R&D programs were in need of a
great deal of oversight.
One of the reviews of an external nature that was suggested involved
examination of the interplay between Federal R&D activities and
those in the private sector, specifically the industrial community.
Some of the witnesses expressed the need for more cooperation be-
tween the Government and industry in their research efforts. One of
the witnesses thought that proper congressional recognition should be
given to industry's role in R&D that can serve a useful public purpose.
Another witness stated that an examination of international R&D
policies might lead to improvements in the Nation's approaches to
research programs. On the subject of manpower planning, one witness
suggested that the subcommittee should review and assess the various
efforts now underway in that area to determine if useful results are
being obtained. The rationale for such a project stemmed from the fact
that the Government is the major employer of scientists and engineers
at this time.
Some of the other suggestions for subcommittee priorities included
the use of existing scientific organizations for advice; the development
of 'listening-post' capabilities to detect trends in science; the selection
of topics for scientific policy impact studies; and the inclusion of mili-
tary R&D oversight, at least as it relates to non-military R&D.
Four of the witnesses specifically suggested that the subcommittee or
the Congress should formulate a national science policy. Most felt
that the assessment of R&D efforts would be difficult in the absence
of such a policy. One witness thought that it would be desirable if
future R&D activities were more predictable and if there were more
stability in R&D funding support. This witness thought that these
advantages would naturally result from the formulation of national
science policy.
It was repeatedly observed during these hearings that the work of
the DISPA subcommittee will be important but difficult since R&D
program ideas, reasons, and concepts would have to be dealt with.













APPENDIX


LIST OF WITNESSES

HEARING ON THE ANNUAL REPORT ON FEDERAL RESEARCH AND
DEVELOPMENT PROGRAM FISCAL YEAR 1976
June 3, 1975:
Dr. Russell C. Drew, Director, Science and Technology Policy
Office, National Science Foundation,
accompanied by Dr. John V. Granger, Executive Director, Federal
Council for Science and Technology.
June 4, 1975:
Dr. Betsy Ancker-Johnson, Assistant Secretary for Science and
Technology, U.S. Department of Commerce.
June 5, 1975:
Dr. T. Dixon Long, chairman, Research and Development Com-
mittee, Committee on Science and Public Policy of the Ameri-
can Association for the Advancement of Science, and associate
professor of political science, Case Western Reserve University,
Cleveland, Ohio.
accompanied by Dr. John Logsdon, member, Research and De-
velopment Committee, Committee on Science and Public
Policy of the American Association for the Advancement of
Science, and director, graduate program in science, technology,
and public policy, George Washington University, Washington,
D.C.
July 10,1975:
Dr. Herbert I. Fusfeld, Chairman, Federal Science and Tech-
nology Committee, Industrial Research Institute, and director
of research, Kennecott Corp., New York, N.Y.
Dr. Frank H. Healey, vice president, Industrial Research Insti-
tute, and vice president, research and development, Lever
Brothers Co., Edgewater, N.J.
Dr. Lewis H. Sarett, member, board of directors, Industrial Re-
search Institute, and president, Merck Sharp & Dohme Re-
search Laboratories, Merck & Co., Rahway, N.J.
Dr. Monte C. Throdahl, member, board of directors, Industrial
Research Institute, and group vice president and director,
Monsanto Co., St. Louis, Mo.
Dr. H. Guyford Stever, Chairman, Federal Council for Science
and Technology, and Director, National Science Foundation.
(31)


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UNIVERSITY OF FLORIDA


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