This paper examines the relationships
between government and industry in the pursuit of research. The government
plays a pivotal role in the sponsorship of research. In areas where
the government also plays the role of a practitioner in research conflicts
may arise. A few selective case histories are examined to illustrate
these issues. Understanding and addressing the issues that result
from these interactions is critical to the success of sponsored research
and the vitality of our economy.
We begin by defining a few terms.
We then discuss the rationale for government-sponsored research in industry.
This discussion reveals some of the issues that come into play. Specific
examples are discussed as a means of illustrating these issues. Some
conclusions are drawn with respect to the issues involved in government-sponsored
research in industry. However, resolution of conflict issues awaits
further debate.
What is "Research"?
"Research" for our purposes
is taken to mean investigations prior to applications. This implies
"long-term" development. What is meant by long-term is defined by
context, but usually is taken as some period in excess of five to ten years.
Some projects, like fusion energy, take much longer. Other projects,
like computer development, may take fewer than five years but are still
considered "long-term" in the context of that industry.
What is "Industry"?
We will take industry to mean
organizations organized for profit. To a certain extent, all organizations,
including those that are non-profit, exhibit certain behaviors toward self-preservation.
This should be kept in mind when applying the remarks made here.
Why Government-Sponsored Research?
The government sponsors research
primarily for the benefit of its citizens and constituents. At times
it is important to remember the distinction between citizens and constituents.
We will illustrate this later on.
Why Research in Industry?
Research is performed in industry
in order to continue to provide products and services. It is important
to note that research is often considered a product or service.
Why Government-Sponsored Research in Industry?
The government may find it useful
to sponsor research in industry in order to fulfill its mission of providing
for the welfare of its citizens and constituents. Specifically these
missions may include:
A Defense capability
Risk sharing on projects of economic importance,
but of high risk
Technology transfer to and from government laboratories
Industrial policy guiding development of technologies.
We will adopt the view that some
government-sponsored research in industry is necessary for one or more
of the above missions. Once adopted, the details of the mission do
not dominate the issues raised by the interrelationships between government
and industry.
Conflicts of interests are inherent
in government-sponsored research.
Some issues:
Some issues that arise illustrate
some of the areas of conflict:
Determining the "players/winners".
> Lobbying plays a role
> "Peer Review" and the role it plays,
"Classification", what information is withheld
or available to each of the parties involved,
Property Rights, who "owns" the research,
Industrial Policy:
Pure vs. Applied Research, who should do
which kind of research,
Vendors and Sponsors, who may play which
role
"Big Science"
While not a very large slice
of the government's budget, so-called "big science" projects illustrate
well the wider impact and potential impact of industry lobbying efforts.
Three current examples of "big science" projects include the Hubble Telescope,
the Supercollider, and the Space Station. The first two resulted
from the lobbying efforts of scientists themselves. In this regard,
groups of scientists first agreed as to the resources most important to
their field of research and with varying success, lobbied and convinced
the government to sponsor their research. Because of the size of
the budgets involved (measured in billions of dollars), while not a large
slice of the budget, both of these examples encouraged close scrutiny and
attention.
The third project, the space
station, however, differs from the first two in many respects. The
primary difference is that its constituency is mainly from industry.
Its support amongst practitioners, that is the scientists themselves, is
tepid at best. Indeed the American Geophysical Union (AGU) representing
the interests of space scientists, formally came out against the space
station. At the time of this writing the Supercollider has been canceled,
yet the space station continues. We may take the contrast as evidence
of the importance of industrial lobbying efforts in setting priorities
in government spending on research.
International Science Projects
Big science projects have been
pushed to broaden collaborations to share the expense of conducting the
associated research among nations. There are many examples existing
today of the efficacy of this cost sharing. One important point to
remember is the importance of being a reliable partner. While cancellation
of projects that are supported by a single government has obvious consequences,
cancellation of participation in an international project may preclude
future collaborations as a cost-sharing option. As an example, the
U.S. wished to share the expense of a mission to intercept Halley's comet.
It successfully formed an international collaboration. When the U.S.
decided to end its participation and cancel the mission, many countries
found their considerable investments wasted. More than the loss of
a single mission, the consequences plague future collaborations where cost-sharing
for large science projects is even more critical.
"Peer Review" - Who are these "Peers"?
`Peer review refers to a review
process whereby proposals for research funding are scrutinized by supposedly
disinterested but knowledgeable third parties who are to render an unbiased
appraisal of the proposed research, its reasonableness of cost, and likelihood
of success. As the size of the project grows, reviewers fitting the
ideal just described become more difficult to find. In the case of
the Hubble telescope and the Supercollider, many of the knowledgeable potential
reviewers were involved with the proposal, so the actual effectiveness
of a peer review may decrease with a large project involving a substantial
fraction of practitioners from a single field.
There is a more critical issue
concerning peer review that involves the use of government referees.
This accrues to the dual role government may play as both a sponsor of
research and as a provider. The examination of this issue will take
place as we proceed
Role of "Classification"
As mentioned above, "classification"
concerns the control of the accessibility of information (and sometimes
other resources like equipment). The government's unique role in
determining the accessibility of information may lead to abuse of the peer
review process. The government's unique legal position can also allow
it to determine property rights.
Property Rights
"Government free-use license"
is the term applied to intellectual properties spawned by the research
it has sponsored. This usually provides for a two-year grace period
(not in all cases), which allows the organization sponsored to acquire
patent rights, or equivalent, to protect its stake. The government
retains free-use of the property to avoid repaying for the same research
sponsored. Departures from this norm include involuntary licensing,
where the government can retain property rights for itself or even another
organization.
Classification issues may affect property rights
in cases where the property is itself protected by government secrecy.
Because of the government's pivotal role in both the granting of property
rights and determining the disclosure of information, the possibility for
abuse exists.
Vendors versus Sponsors
Many if not most, of the issues
raised so far can be traced back to the government's role as both a sponsor
of research providing funding to the organizations that perform the research,
called generically the vendors, and its concurrent role as a vendor, itself
performing research through its national laboratories.
By way of illustration, we will
examine a specific case to see how many of the issues described came to
the forefront.
Some History of Laser Fusion: KMS Fusion, Inc.,
v. DOE
The idea of using powerful lasers
to release fusion energy grew in the national laboratories in the middle
to late 1960's out of the weapons program. In the early 1970's Kieve
M. Siegel (KMS) sponsored this research forming a company KMS Fusion, Inc..
The initial success of this company, achieving the first controlled fusion
reactions in May 1974, embarrassed and dismayed the national laboratories
and some in government. Nonetheless, the Atomic Energy Commission
(later to become the Department of Energy ) began to fund the research
at KMS.
In 1978, new owners took over
with the passing of Prof. Siegel. These owners had no previous knowledge
in fusion energy, however, they came with a familiarity of how lobbying
may aid in increased funding. Their efforts were successful and government
funding grew for KMS. By this time the national labs were having
their own successes and missteps.
In the late 1980's, on the occasion
of an overall increase in the funding for all of laser fusion, (promoted
by KMS), most of the national labs shared in increased funding. One
national lab however felt left out and began a concerted effort to use
its powers to eliminate KMS which it now viewed again as competition.
This lab was allowed to use its state representation in Washington to launch
a Government Accounting Office (GAO) probe of KMS. KMS would be subjected
to a "peer review". The government would use the national labs as
reviewers. It is cautionary to note how simply a vendor, the national
lab, could manipulate the government towards its ends.
In the course of the GAO investigation,
reliance had to be made on the DOE and the national labs for technical
input. This allowed the conveyance of allegation to become fact.
Classification protocols were then used to control dissemination of the
"facts" in the investigation to KMS, even those provided by KMS.
In the end, the government ended
its sponsorship of research at KMS in favor of another vendor. As
for the property rights, presumed to accrue to KMS, the government may
avail itself of its prerogative in assigning those rights to a new vendor.
In this case history, we can
see most of the issues that arise in government funding of research in
industry from lobbying and peer review, to classification and property
rights. Most of the conflict of interest issues may be traced back
to the dual role the government plays both as sponsor and as vendor.
"Industrial Policy"
As the focus for sponsored research
in industry turns away from its defense mission to one of economic vitality,
we can anticipate the issues described above to become more prominent.
Examples include: the Advanced Research Projects Agency (ARPA) support
of "non-defense" research and development (e.g. high definition television),
the National Science Foundation's new mandate to earmark sixty per cent
of its funding toward strategic technologies, the Department of Commerce's
Advanced Technology Program supporting "Pre-competitive Technology" by
funding consortia in a way like a "Civilian ARPA", as it has been called.
Conclusion
The conclusions must be left
to the individual, but some are offered here as a starting point for the
debates which should come.
Government-sponsored research
is useful, and even necessary. However, because the government continues
to play the role of a vendor as well as a sponsor, conflicts of interests
are inherent. Issues such as use and abuse of lobbying, the conduct of
peer reviews, "Classification", and property rights will become increasingly
important, as will the role of the government as both sponsor and vendor
of research.
DISCUSSION
Other motivations for government
sponsored research include prestige for the government itself. A
successful research endeavor can be something that the government points
to with pride as evidence for achievement. More recently, some research
funding has bypassed traditional peer review mechanisms, being dictated
directly by Congress. In this situation, some argue that part of
the motivation comes from a desire on the part of Congressional representatives
to demonstrate clout by bringing a project back to the home district.
There has been some conflict
in the academic community arising from University participation in classified
research, one of the arguments being that such research violates the principle
of openness. It is worth noting that industry in general does not
work under that principle (for proprietary reasons) and hence may provide
a more natural environment in which to perform such research.
The mechanism by which funding
decisions are made raises some interesting questions. While one might
wish to rely on peer review, can such objective review exist for large
scale projects? The "peers" would likely come from one of a limited
number of other groups active in the field. However, in a situation
involving limited resources and a small number of active groups, any funding
decision will have direct or indirect impact on all of the groups, giving
rise to a conflict of interest. Does industry have too much influence
in determining the winners in the scramble for funding? It may rely
more on lobbying and other political means as opposed to scientific argument
for achieving its funding goals. Finally, can peer review reasonably
exist for classified projects?
It has been pointed out that
conflicts of interest are inherent in the government's dual role of sponsorship
of research in industry and manager of its own research labs. When
it turns to members of its own labs for advice or "peer reviews" regarding
an industry-based project, its own scientists may be directly affected
by funding decisions they recommend. However, the mere existence
of a conflict of interest does not imply that the resulting peer review
is necessarily biased. Are there other procedures which could be
implemented when such a conflict of interest arises, which would improve
the chances for a fair review?
Some projects are of sufficiently
large scale that international cooperation is the most likely means for
attempting them. To what extent is the maintenance of a commitment
to participate in an international science project an ethical requirement?
Clearly there is an economic fallout when one country suddenly backs out
of an agreement. On the other hand, some would argue that an obligation
itself is not a sufficient reason to pursue a bad idea.