Distrust of government has long focused on economic and cultural matters, with conservative luminaries from Barry Goldwater to Ronald Reagan arguing that it should be kept out of private spheres ranging from the bedroom to the boardroom. This sentiment generally has not extended to the realm of science, however.
Since federally supported science helped win World War II and put astronauts on the moon, there has been strong bipartisan support for continued investment. For example, in the late 1990s, Republican House Speaker Newt Gingrich advocated for tripling the National Science Foundation budget, and there was successful bipartisan effort to double research funding for the National Institutes of Health.
But that consensus is now under assault from the libertarian right, which has begun to view agencies such as the National Science Foundation as just one more wasteful government enterprise that constrains risk-taking entrepreneurs. Some, like Silicon Valley guru Peter Diamandis, acknowledge that federal research funding spurred past innovations, but now, they say, it just gets in the way. Better to rely on super-rich magnates such as Elon Musk to fund research. Michael Arrington, former editor of the widely read Silicon Valley blog Tech Crunch, speaks for a growing number of conservatives when he complains that Washington should “just leave Silicon Valley alone.”
Now author Matt Ridley, in a recent Wall Street Journal essay titled “The Myth of Basic Science,” has gone even further, arguing that federal funding for research is not just worthless, but actually detrimental. Mr. Ridley, a libertarian conservative member of the British House of Lords, writes: “Heretical as it may sound, ‘basic science’ isn’t nearly as productive of new inventions as we tend to think.” Given how much attention Ridley has gotten for this preposterous claim, it is worth analyzing his argument in more detail.
Ridley starts by listing an array of pre-WWII mechanical inventions that he asserts were developed independently of scientific progress. But this is misleading for two reasons. First, Ridley conveniently ignores the many cases where basic science laid the groundwork for mechanical inventions. For example, Derek Cheung’s excellent history of electronics, “Conquering the Electron,” shows how important scientific discoveries from Faraday, Maxwell, Hertz, and others were to later developments in electronics, including electric lighting, radio and television, radar and computers. Second, the vast majority of science historians agree that it was only after WWII that science became intimately linked to innovation, as advances in chemistry, electronics, and other disciplines relied on basic scientific research.
Ridley goes on to argue that “for more than a half century, it has been an article of faith that science would not get funded if government did not do it, and economic growth would not happen if science did not get funded by the taxpayer.” Ridely, contrarian that he is, disagrees, arguing “there is still no empirical demonstration of the need for public funding of research.”
He then goes on to cite several studies that purportedly substantiate his view. He cites a US Bureau of Labor Statistics article as proof that the return on investment from publicly financed research and development is near zero. But what the author was actually measuring was the impact of that R&D on the productivity of government agencies, which is in fact low. After all, when the National Institutes of Health funds research to cure cancer, the results do nothing to make NIH workers more productive. But the author goes on to conclude that “many advances arising from university or government research eventually have an important indirect effect on growth,” writing that “programs, especially those in which university scientists compete for grants, such as the National Science Foundation, the National Institutes of Health, some Department of Agriculture programs, and DARPA in the Department of Defense, appear to have a remarkable record.”
Ridley does the same thing when he cites an OECD study on the sources of growth among its member countries in the 1970s, ‘80s, and ‘90s as evidence that “whereas privately funded research and development stimulated economic growth, publicly funded research had no economic impact whatsoever. None. This earthshaking result has never been challenged or debunked.” Yet, the OECD study Ridley cites immediately qualifies that finding with: “there are important interactions between public and private R&D activities as well as difficult-to-measure benefits from public R&D (e.g. defence, energy, health and university research) from the generation of basic knowledge that provides technology spillovers in the long run.” Moreover, there have been many other, more comprehensive OECD studies that have found publicly funded research does in fact have a major effect on innovation and growth.
But even if federal support for research had no effect on private innovation, it certainly wouldn’t be detrimental. (So what if scientists are discovering Higgs boson particles?) Yet for Ridley to advance his radical libertarian case, he has to assert that federal research funding somehow “crowds out” private sector research. So he asserts, unconvincingly, that “if the government spends money on the wrong kind of science, it tends to stop researchers from working on the right kind of science.”
This defies logic. Indeed, virtually every study on the effect of federally funded research on private sector funding finds that federal research spurs more, not less additional private R&D. Far from crowding it out, federal funding actually crowds in and makes it more productive for business to invest in research.
In the real world, there are countless cases of successful innovation that trace their foundations to federal support for science. Indeed, Silicon Valley would still be full of apricot trees without federal support for research. In 1992, Santa Clara County received more defense money per-capita, mostly for R&D, than any other county in the nation. Oracle got started doing work for the Central Intelligence Agency; Intel sold much of its early output to the Pentagon; and Sergey Brin was working on bibliographic research with a grant from the National Science Foundation when he conceived of Google. As the Information Technology and Innovation Foundation has documented, new scientific understanding subsequently enables applied research and commercialization of technologies that have re-shaped our world, from hybrid corn to reverse auctions to the shale gas revolution to supercomputing.
It’s time to examine the record and once again establish the bipartisan consensus that federal funding of scientific research is a key enabler of private sector innovation.
Robert D. Atkinson is president of the Information Technology and Innovation Foundation.