106 



MSPOMSIS TO THI ARGUMENTS FROM THE REPUILICAN WITNESS 



SUMMARY 



Dr. Martino makes the basic argument that federal funding distorts science and 

 that the government should "privatize" the funding of science. He is not directly criti- 

 cal of federal labs in his book, his main criticism is of scientific earmarking. 



FEDERAL LABS 



Dr. Martino does not attack the federal labs in his book, in fact, the only quote in 

 his book mentioning the labs is positive. He says that " the end result lof technolog y 

 transfer from federal laboratories will be that the taxpayers will receive double benefit 

 from federal in-house R&D: the accomplishment of the mission for which the R&D 

 was performed; and technology transfer to the private economy." 



SCIENTIFIC EARMARKING 



Dr. Martino's opposition of scientific earmarking is shared by most of the science 

 and technology community because it uses scarce research funds for non-peer re- 

 viewed projects at the expense of more meritorious projects, in 1992, Congress ear- 

 marked $993 million for R&D and research facilities - less than 2% of total science 

 and technology funding. 



ARE THE ARGUMENTS FOR GOVERNMENT R&D FALSE ? 



In his book, Dr. Martino questions the argument that firms underinvest in R&D. 

 He feels that firms must adequately invest in R&D to remain competitive. This argu- 

 ment ignores the difference between basic research (high risk research on new scien- 

 tific breakthroughs) and applied research and development (research on improving a 

 technology or creating a product). While firms must invest in applied research and 

 development or fall behind their competitors, they have little incentive to invest in ba- 

 sic research because the results are easily duplicated by their competitors. Also, today's 

 smaller high technology firms do not have the resources to support basic R&D. Fi- 

 nally, the government, which does not need to show an immediate return on an R&D 

 investment, is better able than the private sector to conduct risky basic R&D. 



Dr. Martino also argues that the government should not support R&D because: 

 1) there is no way of determining how much R&D a country needs; and 2) even if the 

 amount could be measured, "government failure" would prevent the public sector 

 from reaching that amount. These arguments amount to saying that since we don't 

 know how much we need - we shouldn't do anything. 



DOES GOVERNMENT FUNDING DISTORT SCIENCE ? 



While it is true that politics do impact the funding of science projects and that ear- 

 marks sometimes fund poor quality research, Martino himself points to the many suc- 

 cesses of the U.S. science and technology system. The Uniteci States leads the world 

 in most fields of science, holds die most Nobel prizes and other scientific awards, is 

 the international center for science education and has the strongest high technology 

 sector. All of this was accomplished with the current system of mixed government- 

 private sector funding of R&D. While diere are problems, we still have the best sys- 

 tem in the world. 



SHOULD THE GOVERNMENT PRIVATIZE ITS SCIENCE ROLE ? 



Dr. Martino will make the argument that the private sector, philanthropies and 

 the general public should replace government science funding. Because of the magni- 

 tude of government spending ($66 billion and 43% of total national spending) it is 

 unlikely that government funding could be fully replaced. Private sector R&D spend- 

 ing would have to nearly double to replace government funding. Furthermore, the 

 private sector now depends on the government for most basic research (the govern- 

 ment funds 63% of national basic R&D). As for private citizens and philanthropies, 

 they spend less than $3 billion on R&D and account for less than 2% of total national 



