Economist's View: Larry Summers Issues an SOS

リンク: Economist's View: Larry Summers Issues an SOS.

As in "Save Our Sciences":

America must not surrender its lead in life sciences, by Lawrence Summers, Commentary, Financial Times: The 20th century was shaped by developments in the physical sciences. ...[S]olid state physics ... allowed mankind to take flight and split the atom. Advances in … physics also led to the development of the transistor, the semiconductor and ultimately to the information technology explosion that transformed economic life. The 20th century was an American century in no small part because of American leadership in the application of the physical sciences...

[T]he 21st century will be defined by developments in the life sciences. Lifespans will rise sharply as cures are found for chronic diseases and healthcare will come to be a larger share of the economy than manufacturing. Life science approaches will lead to everything from further agricultural revolutions to profound changes in energy technology and the development of new materials. ...

It is natural to ask whether the US will lead in the life sciences ... as it did in the physical sciences... It is a profoundly important economic question, but one whose implications go far beyond... At present, ... the US is clearly leading in the life sciences. But past performance is no guarantee of future success. ... If America is to maintain its leadership in life sciences..., important steps must be taken.

Most abstract but most important, there needs to be respect for the scientific method and its results. In sharp distinction to … other industrial countries, there is an increasing move away from respecting the scientific method in US schools. Polls demonstrate that up to one-third of high school biology teachers have as much faith in intelligent design as in evolution …[and] that as many as 70 per cent of the American people agree with them. Matters are not helped when the president advocates the teaching of intelligent design alongside evolution as a “different school of thought”.

Second, funding has to be a priority. During the past three years, when there has been more possible in the life sciences than there has ever been, when we are on the cusp of achieving important breakthroughs in everything from stem cells to the treatment of cancer, government funding for science research has been cut in real terms. This has been particularly hard on young researchers...

Funding, however, is ... also a matter of … compensation levels… In today’s economy a … graduate of a leading business school earns a substantially higher salary than a ... graduating ... PhD in biology. Several years after graduation the differences are even more pronounced. It should not be a surprise that ... more of our talented young people are not headed towards careers in … the life sciences.

Third, we need to control the role of politics in allocating science dollars, which are currently tossed around like so many political footballs. The fact that diseases that afflict the relatives of key congressional appropriators receive a disproportionate share of research dollars is not a step towards scientific progress. And it is not a step towards a healthier 21st century to allow the views of a vocal minority in effect to cut off funding for embryonic stem cell research – which is likely to lead to revolutions in the treatment of Parkinson’s disease, diabetes and cancer within the next generation.

Finally, we need to support clusters of extraordinary performance. If competition is individualistic, the US is going to have a very difficult time because salary levels … are going to be much lower in other parts of the world. Rather than focus on each individual …, the US needs to focus on fostering clusters of innovation – such as Silicon Valley in information technology, Boston in the life sciences, New York in finance – where each talented individual derives his or her strength from all that is around. Competing with that on price is much more difficult.

These are not issues that can be addressed in a year or even a presidential term. Nor are they issues that will have a large predictable impact over a period of several years. But over the long run, few issues are as important...

Update: In comments, dale says:

Save US superiority in the life sciences. Save US superiority in financial services. Why didn't we act to save US superiority in manufacturing? Why aren't ordinary Americans deserving of such centralized industrial planning projects?

Why would foreign dominance in the more intellectual and ethereal pursuits be worse for the US than the Chinese ascendancy in manufacturing (for example)? We are told by some economists that outsourcing and other aspects of economic globalization are good for Americans. But Summers and others now say we must save certain industries.

I suspect class bias is in play.

Is dale right, or is there some fundamental difference in the two industries that justifies a different level of government response (e.g. a market failure in research that is not present in manufacturing)?

Posted by Mark Thoma on January 28, 2007 at 02:10 PM in Economics, Science | Permalink | Comments (15)

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Save US superiority in the life sciences.Save US superiority in financial services. Why didn't we act to save US superiority in manufacturing? Why aren't ordinary Americans deserving of such centralized industrial planning projects?

Why would foreign dominance in the more intellectual and ethereal pursuits be worse for the US than the Chinese acsendancy in manufacturing (for example)? We are told by some economists that outsourcing and other aspects of economic globalization are good for Americans. But Summers and others now say we must save certain industries.

I suspect class bias is in play.

Posted by: dale | Jan 28, 2007 2:56:42 PM

You want scientists - pay them as well as you pay lawyers, MBAs, and such.

When you see 'The Donald' select a savy biochemist or material scientist over a sexy salesman/woman on 'Apprentice'... then you'll know we are getting some where.

Posted by: dryfly | Jan 28, 2007 3:20:44 PM

It's funny to see Summers pound the pulpit for higher science wages. Doesn't the market know best? If you start advocating for industrial policy, where will it end? ;-)

Seriously though, low cost competitors like China have an intrinsic advantage in manufacturing (esp. labor-intensive areas). Nanotechnology and life sciences are examples of the capital (human and otherwise) intensive areas where we have a comparative advantage. The problem, which few commenters dare mention, is that these areas where the US has a comparative advantage (including finance) tend to employ a relatively small number of people, who must be very smart. It's not at all clear that your typical manufacturing worker (or someone who would have grown up to be a manufacturing worker in the good old days) can transition into these industries.

Posted by: steve | Jan 28, 2007 4:04:04 PM

God forbid that science centers in Shanghai and Singapore begin to extend the healthy life-span even more profoundly than those working in Cambridge or San Diego.

Though waving the flag of economic nationalism may get us to focus on some of the unfortunate things we do that discourage the development of young scientists and new medicines. Is it any wonder that so many brilliant kids are going into finance (which has been profoundly deregulated and seen fabulous bonus schedules) ahead of biological sciences where they might save lots of lives but get paid one-tenth as much?

And it's not just the pay...if you really want to work and live in a vibrantly creative atmosphere... how attractive is pharmaceutical development where it costs 10 years and half a billion dollars to get FDA approval?

How can a researcher's long-shot ideas pencil out with that kind of burden waiting downstream? Do venture capitalists even listen to plans with burdens anything like that? It may seem fanciful to imagine drug researchers populating the offices of VC's but if it will happen, if not here, then in Singapore or Shanghai or further downstream even in Dubai.

Posted by: DaveMeleney | Jan 28, 2007 4:12:07 PM

Social class, valuing ...yes; how about connection, the sense that it is ours? The collective view of science seems increasingly dessicated, as if technologies somehow emerged in the absence of history, human effort and values.

If science is reduced to the production of technologies and these in turn are mere commodities, what difference does it make where and by whom such are produced ...as long as you are able to pay the price.

"Is no one inspired by our present picture of the universe? This value of science remains unsung by singers: you are reduced to hearing not a song or poem, but an evening lecture about it. This is not a scientific age." - Richard Feynman

One could actually say something similar about manual labor ...and other things too.

Posted by: RW | Jan 28, 2007 4:21:49 PM

Don't think bio-tech has had a particular problem raising money. Do think China, India et al will win this, and even if they don't win the research competition, what good US winning if intellectual property rights are non enforceable? Could it be that communism-rev.1 is better at throwing tons of talent at a problem; especially given a ten to one population advantage? There's simply no way the US is going to win with the current setup. There's no way we won't continue to loose jobs, PhDs included.

Posted by: ken melvin | Jan 28, 2007 4:30:37 PM

Free trade in its current implementation is driving down wages in life sciences, which of course will lead to less young people going to school for the field here in the USA.

Now replace life sciences with engineering, Microprocessor development, manufacturing, and research.

What's left?

What's left are the only fields where there is no benefit to low cost labor, external salesmen, product managers and financial advisors whose clients are the children of old money.

There is no incentive to enter an economically dying field, but by all means, please tell us how this will make us all better in the long run and is a net positive.

Hopefully, globalization will lead to more people attending offshore colleges whether through online classes, or just travelling there where they can get SOME benefit from globalization without having an 80000 debt at graduation. I say, let academia experience what they prescribe for others--let them retrain for other jobs.

Posted by: ninjaplease | Jan 28, 2007 4:46:40 PM

"The mastery of nature, so the imperialists teach, is the purpose of all technology. But who would trust a cane-wielder who proclaimed the mastery of children by adults to be the purpose of education? And likewise technology is not the mastery of nature but of the relation between nature and man."- Walter Benjamin

Posted by: john c. halasz | Jan 28, 2007 6:11:01 PM

Give graduate science students a piece of the patent action and all will be well; no additional funding necessary. Markets do work; even for graduate students.

Posted by: dd | Jan 28, 2007 6:35:01 PM

"Give graduate science students a piece of the patent action and all will be well;"

"Give" is not a market function.

Posted by: Ninjaplease | Jan 28, 2007 6:59:19 PM

Market functions are few and far between in a higher education system that has a monopoly over credentialing privileges.

Posted by: dd | Jan 28, 2007 7:23:58 PM

"in a higher education system that has a monopoly over credentialing privileges."

Tell that to University of Phoenix Online and the hundreds of thousands of colleges.

Posted by: Ninjaplease | Jan 28, 2007 8:03:34 PM

Yup - cut drug development regs & requirements... that's going to push the economic reward pendulum away from going to law school toward going to MIT.

NOT.

I can't think of anything that would make tort attorneys richer that 'speeding up' drug development via regulatory 'reform'. And I'd bet Pfizer agrees.

Posted by: dryfly | Jan 28, 2007 8:25:25 PM

Mark - "Is dale right, or is there some fundamental difference in the two industries that justifies a different level of government response (e.g. a market failure in research that is not present in manufacturing)?"

Mark, with due respect, why don't we identify the R&D functions by industry that the U.S. transnational corporations are not willing to offshore. If it's not nailed down, there isn't much within the R&D field that can not be subcontracted out (in part) or simply offshored based on corporate "needs".

I am expecting the drug industry to roll more production offshore and I have every expectation that some of the R&D will shift as well, co-locating near major production facilities as have some other R&D operations.

I threw the towel in on chunks of scientific R&D two years ago after sitting through a series of future outlook meetings.

Posted by: Movie Guy | Jan 28, 2007 9:44:27 PM

One possible reason to try to protect life sciences rather than manufacturing might be we might still be able to afford to win the R&D race while the manufacturing one is already effectively over.

As recently as the early decades of the 20th century, aspiring American scientists routinely went to Europe for their training because that was where the best work was being done. Within 10 or 20 years, we may well see a major trend toward the best American students seeking training abroad in some fields.

I think Summers is realizing much the same thing. His beloved (tho' at times hated as well, I'm sure) Harvard may get a real run for its money in the life sciences from institutions abroad.

At any rate, the American ruling class has been too fat, dumb and happy (think of Detroit management building mega-polluting gas guzzling SUVs while China already has higher emissions standards than we do) to notice the steady erosion of the sources of US leadership in the world. It's high time the doyens of the establishment started sweating a bit.

Posted by: STS | Jan 28, 2007 10:31:45 PM