There is one word that shows up consistently in President Obama’s Fiscal Year 2014 budget: innovation. We see it in the descriptions of almost every federal agency’s spending blueprint. (In fact, the word “innovation” shows up 107 times in the 244-page budget.)
The investments that the president proposes in research and development (R&D), in scientific exploration, in cutting-edge education initiatives, and in advanced manufacturing have the potential to result in amazing advancements for our economy. New jobs. New industries. New opportunities for world-changing improvements.
Within the Department of Commerce, the president’s budget devotes $1 billion to “establish a national network of manufacturing innovation institutes that will develop cutting-edge manufacturing technologies and capabilities to propel the competitiveness of U.S. manufacturing.”
Add to that investment the almost $143 billion proposed for R&D funding across the civilian agencies in the president’s plan – a 9 percent increase from FY2012 levels, significant given the major cuts across the agencies – and making permanent the R&D tax credit. And, importantly, these investments would generate significant private-sector matching funds. As ITIF has noted, every $1 in federal research funding sparks 27 cents of private sector R&D investments. If that were to hold, the $143 billion in federal funding would generate more than $38.6 million private sector research funds.
As Commerce Department Deputy Secretary Blank said when explaining its priorities, the budget “reflects our commitment to our core priorities, including revitalizing American manufacturing, spurring innovation by investing in world-class research, science and technology, and driving export growth. Overall, this budget proposes targeted investments that will enable us to carry out our responsibility to help grow American businesses and the economy, while also spending federal dollars wisely.”
These investments are very welcome, and they should serve as a starting point for our policymakers work to develop an aggressive jobs and innovation plan that will ensure U.S. economic strength for many years to come.