Research and development continue to play a prominent role in the national discussion about restoring America’s economic prosperity. Following last week’s release of the report by The National Commission on Fiscal Responsibility and Reform recommending “expanding high-value research and development in energy and other critical areas,” President Barack Obama discussed the value of R&D two separate times this week. The first was during a 40-minute address at a community college that was largely devoted to the importance of innovation that provides an expansive view of the President’s position on R&D, the second in response to a question at yesterday’s White House press briefing. Excerpts from both follow:
White House Press Briefing, December 7, 2010
“But we’ve got to have a larger debate about how is this -- how is this country going to win the economic competition of the 21st century? How are we going to make sure that we’ve got the best-trained workers in the world? There was just a study that came out today showing how we’ve slipped even further when it comes to math education and science education.
“So what are we doing to revamp our schools to make sure our kids can compete? What are we doing in terms of research and development to make sure that innovation is still taking place here in the United States of America? What are we doing about our infrastructure so that we have the best airports and the best roads and the best bridges? And how are we going to pay for all that at a time when we’ve got both short-term deficit problems, medium-term deficit problems, and long-term deficit problems?
“Now, that’s going to be a big debate. And it’s going to involve us sorting out what government functions are adding to our competitiveness and increasing opportunity and making sure that we’re growing the economy, and which aspects of the government aren’t helping.”
“. . . over the next several weeks, I'm going to be meeting with my economic team, with business leaders and others to develop specific policies and budget recommendations for the coming year. Today I want to outline the broader vision that I believe should guide these policies -- and it’s a vision that will keep our economy strong and growing and competitive in the 21st century.”
“Some of you know I traveled through Asia several weeks ago. You’ve got a billion people in India who are suddenly plugged into the world economy. You’ve got over a billion people in China who are suddenly plugged into the global economy. And that means competition is going to be much more fierce and the winners of this competition will be the countries that have the most educated workers, a serious commitment to research and technology, and access to quality infrastructure like roads and airports and high-speed rail and high-speed Internet. Those are the seeds of economic growth in the 21st century. Where they are planted, the most jobs and businesses will take root.
“Now, in the last century, America was that place where innovation happened and jobs and industry always took root. The business of America was business. Our economic leadership in the world went unmatched. Now it’s up to us to make sure that we maintain that leadership in this century. And at this moment, the most important contest we face is not between Democrats and Republicans. It’s between America and our economic competitors all around the world. That's the competition we've got to spend time thinking about.
“Now, I have no doubt we can win this competition. We are the home of the world’s best universities, the best research facilities, the most brilliant scientists, the brightest minds, some of the hardest-working, most entrepreneurial people on Earth -- right here in America. It’s in our DNA. Think about it. People came from all over the world to live here in the United States. That's been our history. And those were the go-getters, the risk-takers who came here. The folks who didn’t want to take risks, they stayed back home. Right? So there’s no doubt that we are well equipped to win.
“But as it stands right now, the hard truth is this: In the race for the future, America is in danger of falling behind. That's just the truth. And when -- if you hear a politician say it’s not, they’re not paying attention. In a generation we have fallen from 1st place to 9th place in the proportion of young people with college degrees. When it comes to high school graduation rates, we’re ranked 18th out of 24 industrialized nations -- 18th. We’re 27th in the proportion of science and engineering degrees we hand out. We lag behind other nations in the quality of our math and science education.
“When global firms were asked a few years back where they planned on building new research and development facilities, nearly 80 percent said either China or India -- because those countries are focused on math and science, and they’re focused on training and educating their workforce.
“I sat down with President Lee of South Korea, and I asked him, what’s the biggest problem you have in education? He said, you know, these parents, they come to me and they are constantly pressuring me; they want their kids to learn so fast, so much -- they’re even making me import English-speaking teachers in, because they want first-graders to know English. I asked him about investment in research and development. He says, we're putting aside 5 percent of our gross domestic product in research and development -- 3 percent of it in clean energy.
“You go to Shanghai, China, and they’ve built more high-speed rail in the last year than we've built in the last 30 years. The largest private solar research and development facility in the world was recently opened in China -- by an American company. Today China also has the fastest trains and the fastest supercomputer in the world.
“In 1957, just before this college opened, the Soviet Union beat us into space by launching a satellite known as Sputnik. And that was a wake-up call that caused the United States to boost our investment in innovation and education -- particularly in math and science. And as a result, once we put our minds to it, once we got focused, once we got unified, not only did we surpass the Soviets, we developed new American technologies, industries, and jobs.
“So 50 years later, our generation’s Sputnik moment is back. This is our moment. If the recession has taught us anything, it’s that we cannot go back to an economy that's driven by too much spending, too much borrowing, running up credit cards, taking out a lot of home equity loans, paper profits that are built on financial speculation. We’ve got to rebuild on a new and stronger foundation for economic growth.
“We need to do what America has always been known for: building, innovating, educating, making things. We don’t want to be a nation that simply buys and consumes products from other countries. We want to create and sell products all over the world that are stamped with three simple words: ‘Made In America.’ That's our goal. ”
“Now, I want to emphasize I say this knowing full well we face a very difficult fiscal situation. I’m looking at the books back in Washington, and folks weren’t doing a real good job with their math for the last decade. So now that the threat of a depression has passed, and a recovery is beginning to take hold, reducing our long-term deficit has to be a priority. And in the long run, we won’t be able to compete with countries like China if we keep borrowing from countries like China. We won’t be able to do it.
“So we’ve already started making some tough decisions. And they’re unpopular and people get mad, but we’ve got to make some decisions. I’ve proposed a three-year freeze in all spending that doesn’t have to do with national security. And I proposed a two-year freeze in the pay for federal workers. That’s why we’re currently studying recommendations of the bipartisan deficit reduction panel that I commissioned. We’re going to have to be bold and courageous in eliminating spending and programs that we don’t need and we can’t afford.
“But here’s where there's going to be a debate in Washington over the next year and over the next couple of years and maybe over the next five years, because I will argue and insist that we cannot cut back on those investments that have the biggest impact on our economic growth . . . . “
“That’s why even as we scour the budget for cuts and savings in the months ahead, I will continue to fight for those investments that will help America win the race for the jobs and industries of the future -- and that means investments in education and innovation and infrastructure. I will be fighting for that.”
“We’re reforming K-12 education -- not from the top down, but from the bottom up. Instead of indiscriminately pouring money into a system that’s not working, we’re challenging schools and states to compete with each other -- to see who can come up with reforms that raise standards, and recruit and retain good teachers, raise student achievement, especially in math and science. We call it Race to the Top where you get more funding if you show more results -- because part of the argument here is, is that if we’re going to have a government that's smart and helping people compete in this new global economy, then we’ve got to spend our money wisely. And that means we want to invest in things that are working, not in things that aren’t working just because that's how things have always been done.”
“Now, what’s also true is a lot of companies don’t invest in basic research because it doesn’t pay off right away. But that doesn’t mean it’s not essential to our economic future. Forty years ago, it probably didn’t seem useful or profitable for scientists and engineers to figure out how to increase the capacity of integrated circuits. Forty years later, I’m still not sure what that means. What I do know is that discoveries in integrated circuits made back then led to the iPod and cell phones and GPS and CT scans -- products that have led to new companies and countless new jobs in manufacturing and retail, and other sectors.
“That’s why I’ve set a goal of investing a full 3 percent - not 2 percent, not 2.5 percent - a full 3 percent of our Gross Domestic Product into research and development. That has to be a priority.
“If this is truly going to be our Sputnik moment, we need a commitment to innovation that we haven’t seen since President Kennedy challenged us to go to the moon. And we’re directing a lot of that research into one of the most promising areas for economic growth and job creation -- and that's clean energy technology. I don’t want to see new solar panels or electric cars or advanced batteries manufactured in Europe or in Asia. I want to see them made right here in America, by American businesses and American workers.”
“And throughout history, the investments I’ve talked about - in education and innovation and infrastructure - have historically commanded the support from both Democrats and Republicans. It was Abraham Lincoln who launched the Transcontinental Railroad and opened the National Academy of Sciences. He did it in the middle of a war, by the way. But he knew this was so important we had to make these investments for future generations. Dwight Eisenhower helped build our highways. Republican members of Congress worked with FDR to pass the G.I. Bill.
“More recently, infrastructure bills have found support on both sides of the congressional aisle. The permanent extension of research and development tax credits was proposed by both Bill Clinton and George W. Bush. Our education reforms have been praised by both Democratic and Republican governors.
“So the point is there should not be any inherent ideological differences that prevent Democrats and Republicans from making our economy more competitive with the rest of the world. If we’re willing to put aside short-term politics, if our objective is not simply winning elections but winning the future then we should be able to get our act together here, because we are all Americans and we are in this race together.”