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America Can't Afford to Cut Its Discretionary Spending

At the heart of our fiscal challenge is a clash between the present and the future, and the future is losing. Intended or not, the top priorities for Republicans and Democrats add up to a relentless squeeze on discretionary spending. That means less for education, less for research, less for infrastructure—the vital public investments that have nourished innovation and growth throughout our history. (It also means less for defense, the topic of a future column.) To go down this path is to imperil our future.

In September of last year, the American Association for the Advancement of Science (AAAS) published a study examining the impact of sequestration on federal investments in research and development. It found that the required automatic cuts would reduce these investments by $57.5 billion over the next five years. The National Institutes of Health would lose $11.7 billion; the National Science Foundation, $2.1 billion. Civilian cabinets and agencies throughout the government would see R & D cuts averaging 8.4 percent. Research in the Department of Defense, which includes not only weapons development but also billions for basic scientific and medical research (much of it university-based) would be slashed by $33.5 billion between 2013 and 2017.

We don’t need to rummage through the history of canals and land-grant colleges to see why this prospect represents such a threat. A 2012 report from the National Research Council (the principal operating agency of the National Academy of Science and the National Academy of Engineering) found that federal investments in information technology R & D had helped create numerous firms with annual revenues of $1 billion or more, along with entirely new sectors of the economy such as microprocessing, the internet, cloud computing, and robotics. The NRC highlighted the role of public investment at the hub of a “complex ecosystem” that makes innovation in IT possible. Much of it has come from the Defense Advanced Research Projects Agency (DARPA) and the National Science Foundation, with the Department of Energy, NASA, the National Institutes of Health, and other agencies also making important contributions.

The NRC report summarized the reasons why these investments were so significant. Among them: federally funded research supports basic research whose practical benefits “typically take years to realize”—the kinds of investments that the private sector is increasingly reluctant to undertake. That is why federal support for research “has tended to complement, rather than preempt, industry investments.” In short, basic research is a classic public good that the private market will undersupply, leaving us all worse off. Federal spending in this area doesn’t displace the public sector. Nor does it redistribute resources. Instead, it promotes economic growth and an improved quality of life for the entire society.

There is another key reason why federally funded IT research is so effective: much of it goes to universities, which provide a uniquely supportive environment. According to the NRC, universities can focus on the long-term, provide a neutral ground for collaboration, integrate research and education, bring together researchers across disciplinary lines, and foster the open exchange of ideas. Put all of this together, says the report, and you get a breeding ground for unpredictable discoveries: “Chance interactions in an open environment can change the world.”

I’ve focused on the consequences of federally funded research for a single sector of the economy. But public investment provides other kinds of collective goods as well. Every able student who drops out of college for lack of funds makes our society poorer. So does every road that snarls traffic and impedes the flow of goods because we refuse to spend what’s needed for efficient transportation.

If we start cutting public investment today, we won’t see the consequences tomorrow. But our children and grandchildren will.

During the fiscal debate that will unfold in the coming months, public officials will hear from constituents who want to keep their benefits flowing and their taxes low. They won’t hear from future generations, who can’t yet speak for themselves. If we don’t act on their behalf, who will?

The forces of generational myopia are very powerful. If they are allowed to prevail, our politicians will have failed. But the rest of us will have failed as well, because it is our collective selfishness that will have forced elected officials to betray the future.

So the fiscal clash between the parties involves more than numbers, more than the policy commitments at the heart of liberal and conservative creeds. It is a test of our willingness to take the words of our Constitution seriously, to do what’s necessary to secure the blessings of liberty not only “to ourselves” but also “our Posterity.” As of now, shamefully, we’re on course to fail that test.