In these days the Obama Administration and the House Republicans are fighting over the 2012 budget. Meanwhile here in Silicon Valley we are holding our breaths and crossing our fingers hoping for the best. As one of the most knowledge intensive regions in the US, increases and cuts in the national R&D budget have great impact on the Silicon Valley ecosystem.
Obama: +772 million USD to R&D in 2012
In Obama’s 2012 Full Year Budget Request presented on February 14th the President suggests an R&D investment of $147.9 billion, which is an increase of $772 million from the 2010 budget. The budget favors priority areas such as R&D, education, infrastructure, innovation and specifically clean energy, and aims to
• Maintain a doubling path for the three science agencies the National Science Foundation, the National Institute of Standards and Technology and the Department of Energy’s Office of Science
• Educate children in science, technology, engineering and math (STEM) i.a. by preparing 100,000 new STEM teachers over the next decade
• Invest in 21st century infrastructure, e.g. by installing high-speed wireless internet to reach at least 98% of Americans
• Encourage private sector investments by calling for an expanded and permanent extension of the Research and Experimentation Tax Credit
• Advance a clean-energy future by advancing research and development of clean energy sources through increased funding and support of industry-academia collaboration
R&D investments to win the future
The request thus reaffirms the President’s focus on the importance of research and development as a means to strengthening the US economy and competitiveness. Furthermore the budget request favors investments in innovation and entrepreneurship through several loan funds and programs. We think the president is right in stressing that these investments are crucial to maintain the US as a world leader in the knowledge economy, where countries like China, India and Brazil are rapidly increasing R&D budgets.
House Republicans proposing to slash R&D spending
This request however is in great contrast to the so called continuing resolution recently proposed by the House Republicans in which they call for dramatic cuts in the science and technology budget. Therefore the scene is set for extended debates and struggles on the future R&D budget. Although it is not likely that Obama’s budget request will pass without modifications, it is fair to expect that the final budget compromise will include increased investments in innovation and R&D. Here in the Valley we keep our fingers crossed looking forward to a positive budget outcome. We will follow the negotiations close and keep you posted!