federal government should fund the research of scientists without knowing exactly what results the research would yield—an idea that flatly contravened the US government’s historical practice.²

Despite the misgivings of many policy-makers, the US government eventually adopted Bush’s idea. The resulting expansion of scientific and technological knowledge helped produce a half-century of unprecedented technologic progress and economic growth. New technologies based on increased scientific understanding have enhanced our security, created new industries, advanced the fight against disease, and produced new insights into ourselves and our relationship with the world. If the 20th century was America’s century, it also was the century of science and technology.

Since 1950, the federal government’s annual support for research and development (R&D) has grown from less than $3 billion to more than $130 billion—more than a 10-fold expansion in real terms.³ Today, about 1 in every 7 dollars in the federal discretionary budget goes for R&D. Performers of federal R&D include hundreds of colleges and universities and many thousands of private companies, federal laboratories, and other non-profit institutions and laboratories. These institutions produce not only new knowledge but also the new generations of scientists and engineers who are responsible for a substantial portion of the innovation that drives changes in our economy and society.

Major priorities within the federal R&D budget have shifted from the space race in the 1960s to energy independence in the 1970s to the defense buildup of the 1980s to biomedical research in the 1990s. In the 1990s, the nation’s R&D system also began to encounter challenges that it had not faced before. The end of the Cold War, an acceleration of economic globalization, the rapid growth of information technologies, new ways of conducting research, and very tight federal budgets led to thorough re-evaluations of the goals of federal R&D. Though Vannevar Bush’s vision remains intact, the R&D system today is much more complex, diversified, and integrated into society than would have been imagined 60 years ago.

In this decade, the challenges to the R&D system have intensified. International competitors are now targeting service sectors, including R&D, just as they have targeted manufacturing sectors in the past. Global development and internationalization, new trade agreements, and the rapid flow of capital are reshaping industries so quickly that policy-makers barely have time to respond. Similarly, workplace technologies and demands change so quickly that workers must be periodically retrained to remain competitive.