The U.S. Federal R&D Budget: Overview and Outlook

Matt HourihanFebruary 20, 2014for the Australian Trade Commission

AAAS R&D Budget and Policy Programhttp://www.aaas.org/spp/rd

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5%

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DefenseDiscretionary

NondefenseDiscretionary

Mandatory

Net Interest

Federal Spending as a Percent of GDP, 1962 - 2018

Source: Budget of the U.S. Government FY 2014.© 2013 AAAS

Emergent Budget Tendencies Discretionary spending tends to be constrained…

Early 1980s: nondefense constraints under Reagan Late 1980s/early 1990s: spending caps 2011 Budget Control Act caps

While mandatory spending tends to grow Health care costs Expanding beneficiaries, aging population Medicare Part D, Affordable Care Act… …versus failed efforts at control/constraint/reform

And, of course, anti-tax politics

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1.5%

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2.5%

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6.0%

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12.0%

14.0%

Federal R&D in the Budget and the EconomyOutlays as share of total, 1962 - 2014

R&D as a Shareof the FederalBudget (LeftScale)

R&D as a Shareof GDP (RightScale)

Source: Budget of the United States Government, FY 2014. FY 2013 data do not reflect sequestration. FY 2014 is the President's request.© 2013 AAAS

Recent R&D Budget History R&D down by 8.4 percent between FY10 and FY12

August 2011: Budget Control Act AAAS estimated ~$50 billion R&D cuts in first 5

years

January 2013: American Taxpayer Relief Act

FY 2013: Sequester cuts nearly $10 billion more

Summer 2013: Appropriators operate under two different spending baselines

December 2013 budget deal: 50% sequester rollback for FY14

Positive outcomes Physical Sciences did

well Defense S&T Department of Energy

Technology programs and Science

NSF facilities, EPSCoR, political science

NASA Science and Exploration

Defense contractors NIH overall

Better for translational science, IDeA, BRAIN

Environmental R&D But cuts avoided

High-performance rail

Less positive

Select International Programs

Fogarty IC (NIH) keeps pace with most other institutes (3%)

International Ocean Discovery Program (NSF) funding matched request

USAID Global Health programs boosted above request ITER below request

Looking ahead… President’s budget to be released March 4 (and beyond)

Priorities: manufacturing, clean energy, climate, IT and computing, biological innovation, neuroscience, STEM Ed

Discretionary spending in FY 2015 has already been agreed And will increase hardly at all 25% of sequester reductions rolled back Beyond FY 2015: back to sequester levels

Big-picture fiscal challenges remain largely unchanged

For more info…mhouriha@aaas.org202-326-6607www.aaas.org/spp/rd/