Christmas Pork.  The City of Luling (TX ) received a $1 M federal grant to help create its first industrial park. U.S. Rep. Lloyd Doggett, D-Austin, helped secure the grant from the Economic Development Administration of the U.S. Department of Commerce. [Austin American-Statesman, Dec 22] See Doggett's grin. Now why would those independent tax-hating Texans accept federal money for local buildings? Because, like SBIR, free money has a certain appeal.  Vote Doggett in '08 for responsible government finance!  Keep alive the Iron Triangle of beneficiaries, Congress, and federal administrators.

Too Mobile Technology.  Federal prosecutors accused five former employees of Eaton Aerospace of stealing trade secrets for the company and taking them to their new jobs in North Carolina. A federal indictment alleges that [the five] stole secrets from Eaton, where they worked, and took them to Frisby Aerospace in Clemmons, N.C., where they started working in January 2002. Frisby is now known as Triumph Actuation Systems. The criminal charges come about two years after Eaton filed a $350 million lawsuit against its former employees and Frisby, accusing them of stealing trade secrets. [Raleigh News and Observer, Dec 23]  At Frisby Aerospace, we always aim high.

Weeping and Gnashing. NSF Director says that "the results would be dire" if Congress sticks to a yearlong spending resolution. [Jeffrey Mervis, Science, Dec 15] With the no-limit spending Republicans about to be replaced by the no-limit spending Democrats, somebody had to call a time-out. The departing Congress did with a catch-all, no growth "temporary" appropriations law which the Dems are about to accept as the final budget for FY2007. The weeping has already started from the agencies who live by the idea that if a little is good, a whole lot is better (as long as it someone else's money). Science is actually politically easy to squeeze because the voters don't feel any pinch.

Fantasies. a (fictional) entity called the Iraqi Army, at the disposition of an (imaginary) power called the Iraqi government, can be welded into an (entirely fantastical) nonsectarian force by (as yet unavailable and putatively suicidal) U.S. military trainers [Alexander Cockburn, Dec 15]

Free Lunch.   since 2001 we've offered $2 in tax cuts for every $1 we have spent on the wars in Iraq and Afghanistan. And conservatives wonder why we have deficits. [EJ Dionne, Washington Post, Dec 15]  Meanwhile, the Army is saying that the free lunch is over, that we don't have enough Army for the wars assigned. And no flood of DOD procurement contracts in Mississippi or Massachusetts will produce more soldiers willing to die for their country. Nor SBIR contracts neither. 

Several Interesting cases discussed by SBIR Insider who obviously keeps up with the government doings (and failings) in SBIR.

The canceling of ATP killed NIST's Phase 1 SBIR for 2007. No money, no awards.

DARPA says it has restored the prizes for the Urban Challenge race of robotic vehicles in city traffic after legal machinations with the DOD Appropriations Act. First, second, and third will get real money of out of a possible 90 racers. But government being what it is, stay tuned.

The Dem leaders, even the great porker from West Virginia, said there will be no Congressional earmarks.  At least until the first chance they get to claim that the elected representatives know the nation's needs better than the president and his bureaucrats.  The great porker from Alaska is no doubt apoplectic.

It's our secret and not even $120B dollars of UK money will induce us to turn over the secret codes needed to operate the Joint Strike Fighter on two new aircraft carriers, Britain is now re-considering the Eurofighter Typhoon project. Not even Blair's political suicide of being the lead ally in the Coalition of the Willing is enough to get our neo-cons to be two-way partners in their one-way street called loyalty.

NASA SBIR picked 260 Phase 1 winners for $25M, an average of $90K per project.  Oh baloney! that $90K isn't enough for a smell test of the technology and the company. A candidate for most notable title and company name Software Tools that Control a Framework of Perceptual Interfaces and Visual Display Systems for Human-System Interaction with Robotic and Autonomous Systems by Turbogizmo. Of course many of the familiar company names dance through the list as NASA values experience over novelty. And of course a heavy diet of math modeling that improves NASA's understanding of its own technology would generate little economic value in any market. 

Army Found an Excuse. Due to lack of FY07 funding and the imminent start of the Army’s Commercialization Pilot Program (CPP), the Phase II PLUS program has been suspended indefinitely and new applications will not be considered. Thus the Army stops the one aspect of its SBIR that would actually bring new capital to the SBIR projects. 

Good Things Take Time and Money. Four years after President Bush ordered a limited missile defense system to be built and nearly a quarter century after Ronald Reagan first proposed the Strategic Defense Initiative, this sub-Arctic outpost, once a cold war training site and still a cold-weather training site, is where progress on the long-embattled missile system is perhaps most evident, military officials say. Eleven interceptor missiles are installed in underground silos here, buried beneath the snow and a former forest of black spruce. [William Yardley, New York Times, Dec 10] But MDA's reliability estimate took another hit when the Navy failed on Pearl Harbor Day to knock down two incoming missiles at once from the same ship off Hawaii's coast. The president of the Missile Defense Advocacy Alliance spun the result, Though this event is discouraging, the testing enables our defenses to be more efficient and more effective. Which means that the R&D money has to keep pouring into MDA's various sub-systems and $9B a year should be providing something like $5B of SBIR base which would produce $100M of SBIR awards.  How much actually gets awarded depends on how slippery the MDA comptroller can be in defining the SBIR base.

Let's Have More of Everything.  If only the so-called conservatives could have their own math to go with their own opinions. Now they want much more defense research. the Task Force on the Future of American Innovation. The group, comprised of organizations from academia and industry supporting investment in basic research, notes that though military R&D spending is at a record-high, the share of DoD science and technology investment dedicated to basic research has declined from 20% to 12% over the past 25 years. [SSTI, Dec 4]  While it's not surprising that academics want more research, the arch conservatives that see every problem as an opportunity for force were the ones who jacked up military hardware spending faster than military research spending. Now they want to bring that up too, all the while reducing the taxes to pay for their military security dreams and simultaneously running a foreign war of nation building that turned out to be more expensive they ever would admit possible.  They also note a potential decline in DOD civilian research folks while they work to undermine the job security that keeps a lot of smart dedicated people on the DOD payroll. Lower the pay and job security and see what kind of management of the bigger science program they get.

Unlimited Demand for a Free Good. Government (or any other) programs that hand out free money will never lack for applicants. Hobbies are fun. NIH is giving out 13 Pioneer awards for the farthest (but still credible) research out of 46000 proposals to all its programs of which about 20% get funded. For all the moaning about ignored science [many promising studies by scientists with stellar track records are also going up in smoke] from a growing supply of PhDs, even government has limits. Ultimately the economics of proposing limits the number of seekers to a decent percent of the amount that the government decides is enough national treasure for such an enterprise.  [facts from Sharon Begly, Wall Street Journal, Dec 8] SBIR of course faces the same limits with something like the same economics of proposing that leads to the same level of proposal funding. What I haven't heard is any hue and cry from the science community for more taxes on science salaries or profits to pay for more science.

When buying and selling are controlled by legislation, the first things to be bought and sold are legislators. -- P.J. O'Rourke

Too Much of a Good Thing. Federal advisers yesterday said that drug-coated stents, which have been implanted in millions, offer clear benefits to many patients but present higher clotting risks to others, suggesting they may be overused. ... Today's [FDA] discussion will cover the public health implications of nearly 60% of the 5 million stents implanted in patients whose conditions do not meet the strict descriptions on the device labels. [Dietra Henderson, Boston Globe, Dec 8]

Maine’s elected leaders believe a sizable injection of public funding is required to accelerate research and technology commercialization ... Businesses in the fields targeted by the R&D program would receive additional support from a $20 million Maine Cluster Development Fund, which would support industry partnerships and organizations that promote job growth, entrepreneurial training and networking opportunities. The program would offer 5-7 competitive awards per year to business-led public, private and academic consortia with strategies to stimulate cluster activity.

Commerce Secretary Carlos Gutierrez formed the -- deep breath -- "Measuring Innovation in the 21st Century Economy Advisory Committee" to develop ways of measuring innovation to help policy makers understand its contribution "to American economic prosperity and high living standards," according to a press release. [Benjamin Romano, Seattle Times, Dec 6]

Is Government the Answer? Clean energy now gobbles up almost a tenth of America's venture capital. ... Almost all clean energy therefore relies on government subsidies to make it competitive with fossil fuels. For the moment, politicians seem quite happy to pay up. No fewer than 49 governments, according to Goldman Sachs, an investment bank, have established targets to promote greater use of renewable energy sources: the voters pay, either through higher prices or through direct subsidies. ... But subsidies are not the best way to achieve that goal. Governments that try to pick winners often choose losers. Subsidies distort investment: since the German government fixed the price for solar power at munificent levels, the country has been sucking in huge numbers of solar panels that could be put to better use in sunnier climes. ... But government subsidy is a wobbly foundation on which to build a business. Politicians are a fickle lot. [The Economist, Nov 18]

Oh Dash It, Poor Data. The GAO delivered more evidence that SBIR is nothing but a political handout to an interest group when its most recent study found that SBA's data were inadequate for any decent evaluation. Slap wrists and move on. The wrists belong to the agencies for delivering the inadequate data and to SBA which did little to improve the situation since neither wants an economic evaluation of SBIR. The present government doesn't want meddling in free markets and the agencies don't care about national economics. Agencies Need to Strengthen Efforts to Improve the Completeness, Consistency and Accuracy of Awards Data  There are ways to get economic impact, one pioneered by BMDO more than a decade ago: use the Law of Diminishing Returns to make downstream investment a criterion for subsequent SBIR awards to the company's technology. Oh don't worry, Congress is not about to make the competition that stiff and rewarding.

With a new governor set to take office in January and the world's largest biotechnology convention headed to Boston next spring, leaders of universities and local biotech businesses are meeting this morning to try to launch a lobbying group and think tank that would unite life-science companies, academic laboratories, and hospitals. ... Although the group doesn't yet have a firm agenda, it has a name -- the Massachusetts Life Science Collaborative -- and a budget of more than $600,000 in donated funds. [Stephen Heuser, Boston Globe, Dec 6] 

Meanwhile, Texas wants biotech too.  Texas needs to draw more venture capital funding and to increase its number of biotech companies if it wants to catch up with established biotechnology centers in California, Massachusetts and North Carolina. That's the report James Greenwood will deliver to the state's biotech companies ... The former Republican congressman from Pennsylvania is in charge of a lobbying group for the industry, Biotechnology Industry Organization. ... Texas, like dozens of other states, has selected biotech as an emerging industry that it wants to expand. [Lilly Rockwell, Austin American-Statesman, Dec 5]

Government as competitor. Portland (OR) cuts the cord today, unveiling the first stage of a free wireless network that aspires to make Web access available throughout the city within 18 months.  [The Oregonian, Dec 5] The telcos' addiction to a monopoly for their huge installed capital base have run afoul of a public demand for high speed Internet that the politicians can pretend is free. I doubt that the taxpayers voted to raise their taxes to pay for the new public convenience. 

Too Much Temptation Meets Too Much Opportunity.   quizzicus writes "Paperless electronic voting machines 'cannot be made secure' [pdf] according to the National Institute of Standards and Technology (NIST). In the most sweeping condemnation of voting machines issued by any federal agency, NIST echoes what critics have been saying all along, that due to the lack of verifiability, 'a single programmer could rig a major election.' Rather than adding printers, though, NIST endorses the hand-marked optical-scan system as the most reliable."  

Potomac Fever. A  retiring Republican after 24 years in Congress is selling his home there and taking a part-time job at a think tank in Washington.  [AP, Nov 24]  Small government is only for speeches.

Now that the election is over, the White House lowered its forecast for economic growth, and people can continue to believe politicians' economic forecasts at their own risk.

Turning Left Into a Wall. These fractious [Democratic] groups have coalesced for now around some obligatory centre-left shibboleths. ... The Democrats think that they won this month at least in part because globalisation has given free market economics a bad name. Voters in the Midwest and in northeastern America voiced grave concerns about economic security. These voters are no longer the Reagan Democrats who embrace small government, but steelworkers, car workers and service sector employees who fear for their jobs from global competition. Here, the most worrying aspect is that even the centrist Clinton folks have backed away from the free market ideas they used to embrace.  ... Americans have not given up on the free market yet, thank goodness, but the endurance of [Milton] Friedman’s legacy will be severely tested in the next few years. [Gerard Baker, The Times (London), Nov 21] The danger is that Dems will over-emphasize economic defense at the expense of the wealth-creating free market enterprise. They could well fall into the trap of copying  the defensive SBIR crouch of the handout advocates and the government mission agencies. 

Prepare to Believe!  The world's first Creationist museum , including its blog, will promote the idea that Genesis factually tells the creation of the world. Open next year in rural Kentucky with its motto: "Prepare to Believe!" Enough people believe to put up $20M+.  Stephen Bates, The Guardian, Nov 13 describes it in the religion section. It's all part of the amazing museum building all over America and England; try, for example, North Platte NE and three one-room store front museums in Regent ND. 

Ping-pong school boards: Anti-evolutionists John Bacon (R) and Kenneth Willard (R) appear to be heading back to the state school board. Oh well Kansas, we'll see you after the dark ages. [New Scientist blog, Nov 20] I wonder if KTech wonders why it has to struggle so mightily to attract scientists and entrepreneurs to Kansas. Perhaps it's not just the wheat fields and empty spaces.

Defer the Pork. The grand old party that came in with the high principles of the 1994 Contract With America will punt their last chance to execute those principles into the next Congress where they think the Democrats will also bog down also. They have a point about the bogging  down since the electorate is still expecting a nearly free lunch. Therefore no decisions on pending appropriations bill at least until January. Some of the losers in the pork expectations could be plus-up" and other direct Congressional meddling in the awarding of SBIR contracts, especially Phase III "awards".

Handholding 101.  The Army is on the street for a single handholder for SBIR companies that don't know how to commercialize Army technology. I wonder why they can't!  The Commercialization Pilot Program, another Congressional cosmetic small business program, wants to increase Army SBIR technology transition and commercialization success to accelerate the fielding of capabilities to Soldiers and to benefit the nation through stimulated technological innovation, improved manufacturing capability, and increased competition, productivity, and economic growth. The ultimate measure of success for the CPP is the Return on Investment (ROI), i.e. the further investment and sales of SBIR Technology as compared to the Army investment in the SBIR Technology. ... The CPP BAA requires the performance of six tasks as follows: Task 1: Assess and Recommend SBIR Projects and Companies with High Transition Potential; Task 2: Provide Market Research and Business Plan Development; Task 3: Match SBIR Companies to Customers and Facilitate Collaboration; Task 4: Prepare Detailed Transition Plans and Agreements; Task 5: Make Recommendations and Facilitate Additional Funding to Select SBIR Projects; and Task 6: Track Metrics and Measure Results. CPP wants government to tell private firms how to compete in the private market with technology that the Army chose solely on its governmental merits.  Let the Army write an incentive award contract such that the winner collects only if the company actually commercializes and makes an ROI that a private economist would recognize. Otherwise it's eyewash.

Trading Walls. The American worker, not Corporate America, will be the central focus of U.S. trade policy as far as the new Democratic majority of Congress is concerned. ... less-expensive electronics, apparel and other foreign-made goods increasingly available to U.S. consumers. But it also has cost a growing number of American workers jobs, pay increases and pensions. [Kevin Hall and Margaret Talev, McClatchy News Service, Nov 19] Democrats represent jobs and Republicans represent corporate profits. Democrats like walls even at the expense of a wall against American exports. 

NIST Summarizes ATP Input. In the 44 competitions that have been held by ATP between 1990 and 2004, and the nearly 7,000 proposals received, 768 awards in all technologies have been selected for ATP funding. These awards have involved 1,511 participants, an equal number of subcontractors, more than 170 university and 30 national laboratory participants. This amounts to 218 joint ventures and 550 single company awards and $4,371 million of funded high-risk R&D—of which the ATP share is $2,269 million and the industry share is $2,102 million.  Over 66% of all ATP awards have been made to projects led by small businesses. The June 2006 report details input ("investment") in semiconductors and electronics. The report does not show any ROI.   Whatever ATP's value from market intervention, it apparently will end.

Texas Nursery; Georgia School.  Sony, IBM, and Toshiba will move their super-duper Cell microprocessor development at Georgia Tech. The technology that the companies jointly developed in Austin over five years at a cost of $400 million is making its debut in Sony's new PlayStation 3 video game console. ... With $320,000 of funding from the three Cell partners and additional money from outside grants, researchers at Georgia Tech's new STI Center of Competence will explore ways to adapt the technology for other industries, including biotech, finance and digital media creation. [Bob Keefe,Austin American-Statesman, Nov 14]

Stem cells OK in Missouri. Missouri's voters OK'd 51-49 a state constitution amendment that will protect embryonic stem cell research from fits of morality by local government or the legislature. By the narrowest of margins, the electorate voted for an investment climate for scientific advance. But no human cloning which at this stage is merely shooting at stars anyway. The narrow margin, however, does not bode well that the ban will last in the state that nourished the religious politics of John Ashcroft.

Good riddance, say its critics, who believe that market forces, not a government agency, should determine the commercial fate of new technologies. [Science, Nov 3] Now that Congress has officially killed ATP, will there be a eulogy or a resurrection after $2.3B in 768 projects? It all depends on the politics of free market intervention. Of course its advocates never call it that, just like they fuzz any serious SBIR questions. They focus on success stories, with emphasis on temporary local jobs created, and evade any economic evaluation of the whole package.

Best Rich Lowry line ever: Liberals cannot count on conservatives being associated with corruption, incompetence or an unpopular war forever. I'm interested in the passive voice. Associating themselves with the mendacious, malevolent, incompetent, and disconnected-from-reality Bush administration was not something that was done to conservatives, but rather something that conservatives did. [Spencer Ackerman quoted on Brad deLong's blog, Nov 14]  Don't worry (or do worry), the electoral pendulum will swing away from the deficit spending Democrats soon enough as the country still longs for a free-lunch government. And the SBIR advocates have their bellies right up to the free-lunch bar for handouts that they don't have to justify economically.

Jefferson, the ultimate optimist about progress in science and democracy going hand in hand, died in 1826, at the dawn of what became known as Jacksonian America, a raucous new era of muddy-boots rule by "the people." Alexis de Tocqueville, the French aristocrat who toured this America in 1831 and was its most perceptive chronicler, worried about the prospect for science in the new Republic. "Nothing is more necessary to the culture of the higher sciences or of the more elevated departments of science than meditation; and nothing is less suited to meditation than the structure of democratic society," Tocqueville observed in "Democracy in America."  For a very long time, this appeared to be the rare Tocqueville insight that was off the mark. Our current age, though, seems bent on proving him right after all.  [Paul Starobin, Who Turned Out the Enlightenment, National Journal, Jul 28]

Gridlock is Our Friend. Every war in American history that lasted more than a few weeks was authorized by a unified government. It's also worth noting that every major entitlement program -- the spending programs that are bankrupting the country -- was enacted by unified governments. [Mark Perry (Carpe Diem), Nov 8]

Federal Funding Strategies For Today's Manufacturer. Some useful advice from Industry Week.

Believe half of what you see and nothing of what you hear.  The spin we hear from all sides in the closing days of a campaign is like a bad poll that oversamples two demographic groups: people who have no idea what's going to happen, and people who wouldn't tell you if they did. [Bruce Reed, Slate] You can always tell when a partisan is spinning: the lips move.

The governor-elect [Patrick] has reassured biotechnology executives by saying he supports embryonic stem-cell research, and wants to finance it with state bonds. ... But it is Washington that has the real impact on life-science companies. The federal government is the single largest purchaser of healthcare in the nation, chiefly through Medicare, and what it pays for drugs and medical devices can affect local giants [Stephen Heuser, Boston Globe, Nov 9]. And Democrats have a gene for directly helping the lower economic class even at the risk of lowering profits that incentivize research. It's a case of seeing the drug availability problem from the bottom rather than from the top. Eventually, the federal ban on research funding for stem cells will go away and the progressive states will no longer have to do it themselves. 

Rummy takes the spear. Like a faithful warrior, SECDEF Rumsfeld resigned when the messy war that he advocated and formally ran finally caused a political landslide on the President's party. Shades of Robert McNamara. How many more times do we step into or facilitate civil war before we learn?  Probably many times since politicians don't seem to learn much from international history.  They use myths of history selectively, as a drunk uses a lamppost, more for support than for light. The departure also breaks up what Maureen Dowd called a love story: W. is the hood ornament, but Cheney & Rummy are the chitty chitty bang bang engine of this administration. Their four-decade friendship stretches from Nixon to Bush II, from Vietnam to Vietnam II.  ... Rummy did have one other defender. The House majority leader, John Boehner, told Wolf Blitzer that it is the generals who should be blamed if the war is going badly.  [New York Times, Nov 4] Politics works that way: failure is never and always the fault of the maximum leader. 

Whatever Gets Votes. In Dubuque the Democrat Congressional challenger tries bashing globalization and Bush's "unfair trade deals." He has urged more focus on labor rights in national trade policy and talked of using economic sanctions to keep America competitive. If he watched the river traffic, he might notice all the grain going to export that would stop if the US built a high tariff wall and our trading partners took the same beggar-thy-neighbor policy. The Republican free-trader says the Democrat is living in a "protectionist fantasyland," but concurs that "deep down, there is that kind of angst" over trade and the economy. [Wall Street Journal, Nov 6] Unfortunately for democracies, short term protection for present jobs takes precedence over long term policies that adapt to worldwide realities of inevitable competition.  Perhaps the strongest competitive tool the US has had since its founding is its Constitutional ban on internal tariffs.  And if we look for the causes of short-sighted government, the best tool is a mirror.

When Policy Should be Based on Whatever Works. The central problem that the Coalition for Evidence-Based Policy seeks to address is that U.S. social programs are often implemented with little regard to rigorous evidence, costing billions of dollars yet failing to address critical needs of our society -- in areas such as education, crime and substance abuse, and poverty reduction.  A key piece of the solution, we believe, is to provide policymakers and practitioners with clear, actionable information on what works, as demonstrated in scientifically-valid studies, that they can use to improve the lives of the people they serve. The coalition is the brain-child of Jon Baron who ran (in a limited sense) the DOD's SBIR for five years in which time he tried to steer DOD's SBIR into a path of favoring projects that had a downstream future. For one, he invented the Fast Track idea that has withered since he left. Fast Track used the idea that the best indicator of a technology's future was early investment by third parties with their own money at risk.  Jon's evidence-based idea is a variation on "measure what you treasure" instead of basing policy on intuition, popular myths, and a free lunch.  

Paving a Road. Intel hopes to work with local companies and governments to replicate the setup in hundreds of other villages in China, and is helping deliver computers and Internet access to rural health clinics and schools. It is also rolling out similar initiatives in India. [Wall Street Journal, Nov 3] Suppliers of IT stuff better hope that Intel succeeds in building an American high tech presence among the two billion people. The PC-saturated American market has had its big growth phase and bloggers don't need new hardware and don't create wealth. 

First State Innovation is Delaware's move to get out of the cellar of the fifty-state innovation league. At the outset, the organization will work on attracting venture capital and investment money. Second, it intends to create an "angel fund" that will provide seed money for early-stage business. Next, it will work on forming a closer link with academia.   [MAUREEN MILFORD, The Wilmington News Journal, Oct 30] The usual things states do. On the board are the CEOs of Dupont and Hercules, not exactly high tech biggies in bio- or info-tech even with Dupont's claim of operates as a science and technology company with a heavy dose of chemistry research among its 5% of revenue going to R&D. Microsoft devotes 15% and Intel 12%.  Delaware had only 92 SBIR projects in 2002 of which 33 went to one company. Next door Pennsylvania had 820 projects spread all over although a few SBIR mills get a chunk. What Delaware might consider is a Tri-State operation centered on Philadelphia that would bring in higher powered universities like Drexel and Penn and the aerospace companies.  After all, what Delaware wants is a vibrant economy, not small high tech businesses as an end in itself. Just as Silicon Valley needs San Francisco and all the counties around the lower Bay, a Delaware Valley hotbed needs tech-smart entrepreneurs in all the counties along the river from Wilmington to Trenton. Otherwise they can never have critical mass. 

SciTech for the Elite. In New York's New Explorations Into Science, Technology and Math school, which is widely admired as an oasis in the New York City school system, more like an elite private school than the public school it is, the parents are vetted as well as the applicants. Who they are affects kindergarten admission. One PTA meeting became so heated that the police were called to break it up. [Elissa Gootman, New York Times, Nov 4]

It's About Me. Welcome to the Technology Administration (TA), the only Federal agency working to maximize technology's contribution to America's economic growth. Please visit our site regularly to find all the latest news from TA and its three agencies. The top tech stories are all about "the Under-Secretary says".  Lawyer and political operator: Before his confirmation, [Under Secretary Robert] Cresanti served as Vice President of Public Policy at the Business Software Alliance.  Prior to this, he was Senior Vice President and General Counsel for the Information Technology Association of America. Earlier in his career, he served as Staff Director for the Senate Special Committee on the Year 2000 Technology Problem. He was also Staff Director for the Subcommittee on Financial Services and Technology for the Senate Banking Committee. Mr. Cresanti received his B.A. degree from Austin College and his J.D. degree from Baylor University.

science has outrun the capacity of politics to manage, or of society to understand, the implications of technology's rapid advance. A chasm has opened up -- a dangerous one, in Mr. Ikle's view. We live in a world in which biotechnology is near to acquiring the capacity to change the human species; and biological weapons threaten the survival of mankind itself. Scientists are working busily to create super intelligence systems that may well synthesize the computer and the human brain. [Walter Laqueur reviewing Fred Ikle's Annihilation From Within, Wall Street Journal, Nov 2] And to hear the present political debate, one wonders whether democracy has the capacity to elect insightful leaders in an era of instant and complete communications.

High-Tech Cred. Declan McCullagh, CNET writer and techno-political expert. rated Members of Congress on their attitudes toward tech. Top score to Sen George Allen VA who voted the "correct tech way" 78%. Lowest were Representatives Davis KYand Westmorland GA 13%. Full story.

Thinking Sino-Business?  people are asking about China.  Here are a couple of resources.  From a post on the China Law Blog, I learned about This Is China Weblog.  If you are doing business in China, or considering it, these are both blogs to visit periodically. I've been reading One Billion Customers by James McGregor.  I'm early in the book, but already lots of good insights. [Bill Conerly, Businomics Blog, Oct 28]

Charles H. Mack Associates Inc. which develops and markets medical management software, will receive a $2.5 million Innovation Ohio Loan Fund loan at an interest rate of 8 percent, according to a news release. The company will use the loan for machinery and equipment, and make other improvements to its Blue Ash headquarters. [Cincinnati Business Courier, Oct 31, 06 ] No SBIRs.

So far the money for local [Houston] startups is more likely to come from government funds set up to promote early-stage investment, and the amounts are relatively small. ... NCI recently awarded Fairway Medical Technologies  $2.7M to apply nanotechnology to its imaging system, which at this time is focused on early detection of breast cancer.  The Texas Emerging Technology Fund recently gave Nanospectra Biosciences nearly $1.3M to pursue human trials of cancer therapeutics. [Houston Chronicle, Nov 2]  Nanospectra has had at least two Phase 2 SBIRs. Fairway apparently none. The policy failure comes later for the SBIR winners that rely heavily on increasingly easy SBIR and avoid entering the commercial marketplace. Government has to learn to reject such continued dependence and insist on up-or-out. Fat chance!

Logan Monopoly Rejected. A two-year effort by Logan International Airport officials to shut down private alternatives to the airport's $8-a-day wireless Internet service was decisively rejected yesterday by federal regulators, who blasted airport officials for raising bogus legal and technological arguments. [Boston Globe, Nov 2]

VoterTech on Trial. jcatcw writes "One-third of Americans will use voting machines next week that have never before served in a general election. Computerworld.com provides an overview of e-voting in each of the 50 states and the District of Columbia — equipment, systems for voter registration, polling, significant legal challenges to the systems, previous media coverage, links to government watchdog sites, the vendors, technologies and laws that are important to the issue, and a review of "Hacking Democracy."" [slashdot.org, Nov 1]

Geek Wanted. The Congressional Research Service (CRS) seeks a Senior Network Engineer to provide expert technical advice and to create standards and procedures for LAN/WAN development, implementation, and management. Minimum Education: High School Diploma. Practical knowledge rules. Must be able to provide answer desired and to keep mouth shut as politician mangles it in public.

The Pittsburgh Life Sciences Greenhouse gave grants to three local companies: 2-year-old Respironics spinoff Starr Life Sciences makes tools for research labs and universities to monitor small animals such as mice and rats used in lab research -- will use the $150,000 to more quickly launch new products; Clear Count Medical Solutions will use its $250,000 check to help get regulatory approval early next year for the 3-year-old firm's main product, which is used to track surgical tools and reduce medical errors; Neuro Kinetics, which had been around more than 20 years and makes devices that help diagnose diseases, will use its $130,000 to try and win over ophthalmologists for its latest iteration, a new tool designed to help them quickly detect diabetes-induced eye disease. ... Since the beginning of the year, the greenhouse has spent $2 million funding 15 local firms [Corilyn Shropshire, Pittsburgh Post-Gazette, Oct 31]

Clinton says her priorities in the new Congress will be [among others] creating an energy research agency to speed development of alternative technologies.[David Ignatius, Washington Post, Nov 1]  Oh sure, just the ticket, another bureau.

Puff the Red Planet.  NASA's new Red Planet VC fund got a Washington Post [Oct 31] puff piece by Marc Kaufman.  The few facts presented are that the fund will have $75M over five years, was largely instituted by Administrator Mike Griffin who was once president of CIA's In-Q-Tel fund [and was a supporter of SDIO's now defunct SBIR venturing], and that In-Q-Tel employees got a piece of the cake when it cashed in on one supported company. Like the CIA and fledgling Army VC projects, the devil is in the details not in the happy words.  NASA has had 20 years to invest its SBIR in venturesome technologies with a future but allowed the center directors to do what the DOD does - serve their own immediate interests. Red Planet is likely to work only as long as Griffin heads the agency and insists that it work on accountable criteria. Unfortunately, such a project requires years to bring fruit in a political climate that changes NASA administrators frequently.

No Free Lunch. "Massachusetts' high land and housing costs are driving the state's workforce away", says the market-oriented Pioneer Institute for Public Policy Research ...Nine specific industries in the Bay State have costs of doing business that are 20 to 30 percent higher than for their counterparts in New Hampshire, North Carolina, and Texas.  There's a price for a great intellectual climate and a smart mobile work force.

Good or bad news on immigration from Mexico: Bush signed the higher, longer fence bill that will help keep the illegals in the US where they are in demand. Election year fantasy laws to repeal the laws of economics. Supply interdiction does not work against a strong demand except in the mind of politicians. High tech small businesses, on the other hand, have to be realistic about the laws of economics.

Quietly fixing a technical problem usually makes customers happy. But not when the problem is in voting machines and the voting authority isn't told when Diebold "corrected" a motherboard problem. Fixing electronic voting equipment is too sensitive in a world of conspiracy theorists to be left to technicians behind a curtain. Voting has to be completely transparent and auditable.

For Prosperity, Elect a ???. Does the stock market do better when a Republican is president or when a Democrat is? ...  far better under Democrats. .. during those 72 years [1927-1998] the stock market returned about 11% more a year (than Treasury notes) under Democratic presidents and 2% more under Republicans. [Hal Varian, NY Times, 2003] Hoover was frozen by conservative orthodoxy and Clinton got a great ride.  Oh sure, each party can rationalize a way out of blame times while taking credit for good times, but it's all blather because the president has little to do with stock prices during his tenure.

pursuit of an ethical policy is rarely a practical option because politics is the amoral art of the possible, the skill in choosing between the disastrous and the unpalatable [AJ Stockwell, History Today, Nov 06]

Chasing Hydrogen. The administration is announcing, just in time to get the hydrogen vote, $100M for 25 hydrogen R&D projects. [Houston Chronicle, Oct 25]

CT Events. One by one, leaders of newborn companies, from CoolSpine to PowerToad, pitched their products from a podium. In two minutes or less, they talked about the billion-dollar markets they planned to tap and played down any looming competition. ... and the Connecticut Technology Council gave a demonstration of a new database that is designed to help new companies with big ideas, said Liddy Karter, a council director. When launched next month, the database will catalog and store information on start-up companies with potential for growth and less than $10 million in sales. [Hartford Courant, Oct 20]

Little Capital. GAO found that only 7% of the DoD SBIR awards went to firms that had received venture capital investment. It's no surprise that DOD cares little about third party investment or anything but their own immediate R&D requirements. [GAO Report, Apr 06] But with Congress and the White House run by Republican free-marketers (except for pork), why would we expect any link between government and private investment?

Just Glory. DARPA says since the latest DOD Appropriation forbids cash prizes for innovation contests, the three best robots in city traffic will not get a $2M check like the Stanford team got last year. In the form of a partial prize, DARPA did pay eleven contestants $1M each to participate. [Alicia Chang, AP, Oct 20]

Massachusetts gubernatorial candidate Deval L. Patrick said he would take a dim view of using state tax incentives as a major tool for attracting business expansion in the state, saying companies whose plans turn on tax breaks probably aren't worth attracting. [Boston Globe, Oct 22]

Noting that the [New England] region has suffered a loss in manufacturing, as have other parts of the nation, [Dep Commerce Secretary] Sampson told economic developers there was no golden age to economic development, only an ever-changing marketplace where the key to success is looking ahead and capitalizing on new ideas and approaches. [Manchester Union Leader, Oct 20]

NASA handed out 120 Phase 2 SBIRs (from 280 proposals) apparently all at the maximum allowed amount $600K. The list included many of the usual suspects doing the usually suspected stuff. The list by firm.  One multiple winner had had 120 Phase 2s and 220 Phase 1s; another multiple winner already had about 80 Phase 2s and 250 Phase 1s which supplied something like $70M to feed an average staff of about 20 employees since 1988.  One firm has had at least 67 Phase 2s and 160 Phase 1s. One multiple winner has had $200M of SBIR. One firm has had at least 90 Phase 2s and 220 Phase 1s. And on and on.  All of which mocks NASA happy talk about commercialization in its SBIR. The brutal fact is that the centers, not the commpercialization talkers, run the selection show and don't care about actual commercialization or economic return. They just want their government R&D done.   Rookies: eight winners had no Phase 2s as of two years ago.

"The Chinese Government helps out its manufacturers -- our government doesn't," says Combs. [Tracy Purdum, Industry Week, Oct 11] A business leader complains about not enough government while I presume complaining in the next hour about too much government. I wonder if conservative SBIR winners complain about government meddling and inefficient pork. Where you stand depends on where you sit. One response to the IW article said: This is a first! A congressman saying our government needs to help manufacturing. And the truth is that China DOES help it's manufacturing base. I do not feel our government does. The one way they could would be to force China to stop floating it's currency. Also, our government must acknowledge the economic value of manufacturing.  After the respondent learns the difference between "it's" and "its", he/she can read up on the continuing politics of helping business. I'm sure the responder has a unique and personal definition of such help. I also wonder if he/she is willing to pay the price to play in business politics.

Free Lunch Time. Republican leaders this week reminded candidates to focus on local issues, such as money they have brought home to build roads and bridges or for libraries and schools. [Jeanne Cummings, Wall Street Jounral, Oct 18]  Politics is local, and the national Treasury is a free piggy bank.

Where's My Hydrogen? mattnyc99 writes In its new cover story, 'The Truth About Hydrogen,' Popular Mechanics magazine takes a close look at how close the United States is to powering its homes, cars and economy with hydrogen — including a calculation of where all the hydrogen would come from to meet President Bush's demands. Interesting that they break down the future of hydropower not by its advantages but by its challenges: production, storage, distribution and use." [slashdot.org, Oct 17] Panaceas are for politicians; the real world has to deal with choices and economics.

No interest like a vested interest. [85] Silicon Valley executives and politicians signed a letter Monday demanding that federal lawmakers lessen the nation's dependence on oil, ensure more flex-fuel vehicles are sold and use electricity for transportation.  [San Jose Mercury News, Oct 17] How green is our valley!

"A good announcement here, a good announcement there; the fact is that government handouts don't create jobs," [Michigan] state Republican Party Chairman Saul Anuzis says.  But as a political move, the drumbeat of business-subsidy announcements looks to be working  [Christopher Cooper, Wall Street Journal, Oct 16]  If, a big IF, government subsidy programs, SBIR included, are meant for better economic efficiency because of a true market failure, they should be judged by their economic efficiency, and not just their politcial efficiency. Handouts to uncompetitive firms rarely improve on the economic results of just letting capitalism do its thing. SBIR was predicated on the idea that small firms should get the same percentage of R&D business that small firms get in the private sector. A fair-share argument with no economic justification, which has been demonstrated after twenty years of handouts with no showing of any better economic results than doing nothing and letting government invest its R&D as it sees best.

Have Hearings, Will Spend.  Examining hearings of 14 Congressional committees, political scientist James Payne found that 1,014 witnesses argued in favor of greater spending while only seven advocated less, an imbalance of 145 to 1. This is worse that a Cuban election. [Wall Street Journal, Oct 16]

District 3 Mike Turner (R) Richard Chema (D) It's refreshing when a Republican endorses public-private partnerships to revive his deteriorated urban district, as Turner does, rather than trotting out the same old claptrap about the miracle of the market.  In Ohio's District 3, Esquire magazine endorses incumbent Turner. Maybe Turner could insert a lot more private into SBIR. 

Getting Invention Safely to Market. About four months ago, WiSys produced a catalog of roughly 50 UW System inventions intended to make it easy for Wisconsin companies to find technologies they might use. ... from therapeutics for treating alcoholism and seizures to fluorescent molecular probes, and a method for determining water contamination, age and quality. WiSys visits campuses to find the technologies, and works through the Wisconsin Entrepreneur's Network to approach local businesses about using them.... a subsidiary of the Wisconsin Alumni Research Foundation, the patenting and licensing arm of UW-Madison, and one of the oldest and best-endowed academic technology transfer offices in the country. [Kathleen Gallaagher, Milwaukee Journal Sentinel, Oct 14]

Susan Wood made a stir a year ago when she quit the FDA in protest after the agency refused to make emergency contraception available over the counter. (FDA later reversed its decision.) Now, Wood is back in the news as a co-founder of Scientists and Engineers for America (SEA), a political action committee backing pro-science congressional candidates in next month's elections. [Science, Oct 6] Want the government to do what you think is right, influence politicians with more than pleas.National Competitiveness Investment  - An Act. The President, through the head of each Federal research agency, shall establish a program, to be known as the Innovation Acceleration Research Program, to support and promote innovation in the United States through research projects that can yield results with far-ranging or wide-ranging implications but are considered too novel or span too diverse a range of disciplines to fare well in the traditional peer review process. Priority in the awarding of grants under this program shall be given to research projects that--  1) meet fundamental technology or scientific challenges; (2) involve multidisciplinary work; and (3) involve a high degree of novelty.  S.3639  Council on Competitiveness President Deborah L. Wince-Smith said Hooray. Just what the agencies need: another telescoped grand objective program with its own rules. As if SBIR weren't enough burden already. Stay tuned to see if any money is actually appropriated or whether it is just an election year stunt.

Expenditures Rise to Exceed Income. According to the WSJ, "the federal budget expanded to $2.7 trillion last year, a 9% increase, or three times the inflation rate. Over the past six years the federal budget has increased by 49.2%."  The budget deficit is shrinking because of a "tidal wave of tax revenues:" Tax collections have increased by $521 billion in the last two fiscal years, the largest two-year revenue increase in American history (even adjusting for inflation). [Mark Perry, Carpe Diem blog, Oct 7]

What's Congress For?  Schenectady NY wants its three Congresscritters (everybody has three except DC's none) to somehow stop a defense contractor from closing a local operation and moving the 260 jobs to Pittsburgh for more efficiency. [Albany Times Union, Oct 12] Why does the federal government never shrink? Because the voters want goodies. They must think the federal money is free, and no Congresscritter is likely to tell them otherwise. Somehow they think that federal money comes from heaven or whatever other magic they believe in. SBIR advocates do the same thing: beg for favored treatment while demanding efficient government.  Everyone wants the benefits of dynamic capitalism (oh, hate socialism) without paying the price of economic efficiency. And why do we see unending stories of sloppy and corrupt government? Long ago Schenectady was a thriving industrial center with the core of General Electric and American Locomotive, with industries all over the Mohawk Valley within reach of the Erie Canal and the New York Central RR.

Every State Hopes.   the Rhode Island Research Alliance will award $1.5 M in grants this year in support of technology research in the state. ... for the competitive research grants, to be awarded in amounts up to $200,000, comes from the R.I. state budget. ...  fund research that will attract follow-on investment from federal and private-sector sources [Mass High Tech, Oct 11]  The politicians spend tax money to pursue dreams of government influence on the private economy. It takes dollars from the private sector to re-cycle to the private sector after a fraction is skimmed to support the politics. With concentrated beneficiaries and diffused costs, such programs are irresistible to politicians and apparently ignored by the taxpayers who are busy earning the bread from which the taxes will be taken to buy votes. Application season Nov 1-15.

SBA is unveiling a revamped Web site today to give business owners a centralized source of regulatory information. Business.gov, formerly devoted to starting and managing a business, now focuses solely on compliance. The site pulls together links from 94 federal agencies' Web sites on business compliance topics ranging from hiring and firing employees to importing goods. [Wall Street Journal, Oct 12]

DOD money for researchy things (6.1, 6.2, 6.3 in DOD-speak) will rise by less than 1% for 2007, which is a lot better than Bush's proposed 16% cut. In an election year Congress hates taking anything away from anybody. So, SBIR money should stay about the same.

Don't Ask.  FDA isn't prepared to ensure the safety of products made with nanotechnology, [because] lacks funding and regulatory power to adequately oversee nanotechnology and may miss potential safety problems or spot them too late to prevent harm, said Michael R. Taylor, a professor at the University of Maryland School of Medicine and a former deputy commissioner of the FDA. [St Louis Post Dispatch, Oct 6] Don't ask an administration that hates business regulation to get out in front of a problem with potentially profitable advances. If there are no demonstrable bodies in the streets, why meddle?

For Togetherness. the most important motivation for participants to form a joint venture was to benefit from the complementary R&D expertise of their partners. In fact, most ATP joint ventures would not have formed without an ATP award. Thus sayeth O'Brien,Wang, Shipp, and McTigue, [Findings from the Advanced Technology Program's Survey of Joint Ventures, GCR 06-889, July 2006] who surveyed ATP winners 1990-2001. There's a bit of circularity running around here: ATP favored combinations of companies for the awards and then surveyed the winners to find out why they combined. The winners needed to say something other than we did it for the money. All hail softball surveys of beneficiaries to justify government funding programs!  Let's have another round of SBIR surveys as well. Michigan, today, is at a crossroads. Start a handout program with some dire and critical situation. This one is the The 21st Century Jobs Fund that will appropriate $394M (if Michigan doesn't collapse before 2007) for commercialization (of anything that will replace auto building).  Applicants must leverage other resources as a condition of the grant or loan. Leverage is bureau- code for sharing the cost. Whom will the state tax to get the money? The politicians mumble.

Almost Heaven.  West Virginia University's new Health Sciences Center is advertising for 42 top health scientists for a new center to be maninly funded by Wyeth. Tenure offered if the holder can get funding from NIH within four years.  Candidates who bring present NIH programs go directly to tenure. [Vicki Smith, AP, Oct 4]

The Walls Have Ears. US Attorneys in more than one jurisdiction will and have prosecuted cases of SBIR fraud in duplicative contracts and fraudulent work after a worker in the company went to the US sheriff with a legally binding promise of a reward of a percent of any money recovered from the guilty company and owner.  Protect yourself: in your proposal explain any past or pending contracts related to your proposed project, and see that you do not charge the government twice for the same work or charge the government for work never done at all by merely copying results from earlier work. The government doesn't mind your repeating testing and experiments if you change the conditions of the test and honestly report the results.  

Some Massachusetts Pork Chops.  The budget includes line items for the following companies and institutions: Massachusetts General Hospital/Harvard University -- $15.905 M for the development of the medical free electron laser;  DRS Technologies Inc., Hudson, Fitchburg -- $11 M for the Permanent Magnet Motor System;  Center for the Integration of Medicine and Innovative Technology/Partners Health Care Inc. -- $9.6 M to develop minimally invasive medical technology;  University of Massachusetts, Amherst and Lowell -- $4.6 M for nanomanufacturing, communications antenna and biomass research.  [Mass High Tech, Oct 2] Why pork? If these items were competitive, they would be funded by the federal agencies who would conduct competitions. The only competition for these awards is political. Will the Mass voters reward the politicians for handing out the goodies at the expense of the other 49 states, or will they realize that that Mass voters are paying for similar goodies in the other states in a way that the only winners are the funded entities and the politicians? If the voters everywhere cannot see through the scheme, they deserve the sloppy and expensive government they get.  

More Science, Less Tax.  In an effort to please everyone, a House panel wants to up the NIH budget by another 5% [Science, Sep 22], while the Ways and Means Committee plots ways to cut taxes. What they need is either some new math or continued public disinterest in deficit financing. If everybody gets something, who will complain except the future voters who will get stuck with the bill after the present lawmakers have passed on?  After all, what's more important than buying votes for the upcoming election?  On the way out the door to go campaign for re-election, Congress ponied up another $70B (war is expensive) for continued war prosecution. (hundreds of billions and no one has to pay any extra tax!) After the election, we will again have budget discipline in the abstract and profilgacy in the details. It will all be fine until the Chinese stop financing the gap at low interest rates.

The fantasy doubling of SBIR was declared DOA in the Senate in the crush of competing priorities, says SBIR Insider Newsletter. The Small Business Committee politicians made the usual encouraging noises for a proposition that had little chance of success. Not content with diverting 2% of federal contract R&D, the small high tech grubbers wanted twice as much despite no showing of any benefit that would not have been obtained if the agencies were free to spend it as they wish. [Sep 06]

September Surprise. Just before his re-election vote, the Governor announced a grand plan to revitalize job growth  although My personal philosophy is to let the private sector do what it does best by driving efficiency and new ideas, but these are some smart, sensible ways we can help. ...  Innovation Tennessee is an economic development initiative hosted by Nashville nonprofit Tennessee Tomorrow Inc., which would receive $5M from the state's Department of Economic and Community Development to provide seed funding to firms commercializing new technologies.  Find out more about the "Next Steps: Job Creation" strategy on Governor Bredesen's website at: http://www.tennesseeanytime.org/governor/viewArticleContent.do?id=865&page=0
[SSTI, Sep 27]

How to Get Funding For an Energy Startup:   Seek Government Interest (there's just nothing quite like a political subsidy); Show Some Success (hopes and dreams won't suffice); Look for Investors with Experience in Your Field; Be Prepared to Wrangle Over Valuation; Don't Overestimate Customers' Willingness to Change (you have to adapt to them); Walk the Walk (eat your own cooking).  [Jonathan Shieber, Wall Street Journal Startupjournal.com, Sep 25] If all else fails, try the Energy Department SBIR where economics isn't so important; it's free even if somewhat suffocating.

Pandora's NanoBox. If federal officials, business leaders and others do not devise a plan to fill the gaps in their knowledge of nanotech safety, the report warns, the field's great promise could evaporate in a cloud of public mistrust concludes an NAS report "A Matter of Size." [Washington Post, Sep 26]

Liberty Beware the Executive.  The Republicans' political frenzy of security lawmaking looks like it will hand an authority-minded President, weakly constrained by elastic law, license to be arbitrary in designating "unlawful enemy combatants", a term that is easier to say than to define. Critics of unrestrained government should be aware of the dangers of speaking out in ways that challenge such an enabled strong executive. Think how Mugabe and Chavez got to be what they are.

Homeland Security, the adopted darling of Bush politics, is on the street again for SBIR/STTR. What can we read from its last batch of awards from its still new SBIR?  The latest Phase 1 SBIR list had 44 awards to 36 firms. Nine firms got their very first SBIR ever.  Five awards went to one firm that has already won at least 589 SBIR projects of which about half went to Phase 2 (a normal ratio).  In rough numbers, that's about $200M of SBIR to one firm over 16 years (SBA data is two years behind) as the firm grew from a handful to over 100 employees.  That's an average of over $10M a year to support an average of 50 employees which is about $200K per employee. Clearly, a firm that the government (including DHS) loves.  Three other firms have had over 200 Phase 1s each. Inference 1: experience helps. Inference 2: commercialization history is irrelevant.

Perfect Computers. "Apparently Maryland election officials never have computer problems. That's why they're fighting so hard to keep their Diebold e-voting machines. Washington Post reporter Marc Fisher received nothing but bad attitudes, dodges, and excuses when he attempted to discuss the issue with the state elections administration and Diebold." From the article: "I asked the state's elections administrator, Linda Lamone, whether Maryland wasn't just a bit too quick to adopt electronic voting. Doesn't the computer at your desk ever freeze up on you? 'No,' she replied. Never? 'No.' But surely people in your office have had that experience? 'No.' (Maybe we've found the solution to Maryland's voting problem: Everybody head on down to Linda Lamone's office, where the machines work 100 percent of the time.)"  [slashdot.org, Sep 23] If you believe in infallability of electronic voting machines, I have a bridge I'd like to sell you who are underestimating the imagination of unethical people when great power is at stake. How many rigged machines do you think would have been needed to grab the Florida 2000 presidential vote? Do you think that state and local election officials are up to the 100% electronic security task, especially the ones politically appointed? 

Think Rust is Good. what does a Rust Belt state have to offer companies in a high-tech hotbed like Austin?  geography, tax reform and research and development incentives. ...  Ohio also has created a $1.7B R&D initiative to focus on new product development, and the state is creating venture capital funds to spur investment.  [Lori Hawkins, Austin Statesman-American, Sep 9]

DOD abandoned a controversial proposal that would have required universities to keep a watchful eye on foreign nationals involved in defense research. ... the Pentagon has removed the badging and separate work area requirements, bringing its rules in line with those at the Commerce and State departments [Science, Aug 25]

A refrigerator hit the bullet. MDA shot down a mock warhead over the Pacific with a "kill vehicle" the size of a refrigerator (says AP) that ran into it at 18,000 mph. Things are still moving toward a workable system, as they have been from the mid-1980s. It ain't easy to do reliably even with plenty of warning. Unfortunately for the US struggle against stateless terror, it's irrelevant.

More Ideas than Money.  The NIH's budget has flat-lined in the last three years, and the grants awarded during the last year of the glory days are running out. As a result, the plug is being pulled on promising research by scientists with solid track records.  [Wall Street Journal, Sep 1] As always with a free good, unlimited demand. It's musical chairs, when the rising money music stops, the freely minted post-docs find too few open chairs.

In-Q-Tel says it has: Delivered more than 130 technologies, many of which have contributed directly to CIA and IC missions. Technology delivered by In-Q-Tel, for example, makes it possible to fuse data from maps, images, text and other sources; visualize information in ways not previously possible; rapidly process vast amounts of information in multiple languages; make sense of seemingly unconnected information; and identify the most critical intelligence faster and more effectively.      Engaged with more than 90 companies, most of which were previously unknown to the government, and more than 10 universities and research labs, which In-Q-Tel identified through its commercial and academic outreach programs and by reviewing more than 5,800 US and international companies' business plans.     Cultivated a network of more than 200 venture capital firms, 100 labs and research organizations, further broadening the IC's access to innovative technologies.   Leveraged more than $1B in private-sector funds to support technology for the CIA and the IC.  Attracting private capital to develop government usable technology is where SBIR has fallen on its face. Because the mission agencies, who control most of the SBIR money, would rather have day-to-day control than a ride on a productive machine.

Infinite Money. The politicians have dreams for doing good that merely require infinite money. What could be better for all than doubling basic research over ten years? Or massively increasing funding for sci-tech education?  Science [Aug 18] reports that a small group of staffers is at work in Washington, D.C., on legislation that could influence science spending for years to come. Their goal is to craft a broad bill aimed at bolstering U.S. competitiveness that Congress could pass before the November elections.

MIT Tech Review has an interesting analysis of the democratization of cruise missiles with emphasis on a conflict with Iran.

only 2 years after the first center was created, Congress has become so unhappy with DHS's management of its research portfolio that it is poised to levy a double-digit funding cut next year across the department's $1.2 billion science and technology directorate, including the centers program. A Senate panel last month labeled the directorate "a rudderless ship without a clear way to get back on course."  ... Legislative aides say that members felt they had no choice but to crack down on DHS's research activities after finding what the House appropriations committee calls "financial reporting deficiencies, including serious difficulties maintaining accurate financial records related to obligations and disbursements." In short, says one congressional staffer, "the directorate [has failed] to answer how it is executing its programs and what it has done with its money."  [Yudhijit Bhattacharjee, Science, Aug 4]  Politicans typically have trouble with basic research because it doesn't produce clear policy answers in a short time (before the next election).   Never mind that Congress created part of the problem by inventing the DHS and wanting instant answers

Wisconsin's 152 economic development programs are not adequately tracked, often overlap one another and have included situations in which businesses awarded grants later laid off employees, according to a sweeping legislative audit ... tax credits provided to the insurance industry cost more than $90,000 for every job created. [Patrick Marley, Milwaukee Journal-Sentinel, Aug 8] Handouts [including SBIR] sound better in politicians' mouths when they are announced than in the cold light of economic day after. 

A Naval Prize - sort of.  The Chief of Naval Research offered to spend $1 million for innovative S&T ideas brought to ONR during last week's 2006 Naval Science and Technology Partnership Conference. Note that it is not a prize in the classic sense of a reward for something valuable achieved; nor does the Navy press release say whether a whole million will go to every hot idea or will be spread like peanut butter over all the good ideas.  Jumping on good ideas is a great idea itself, but ONR and the larger Navy R&D establishment could always do it any time it wants. If a two-star officer cannot write a check for $1M, what are all those stars for?

Models are for Slowpokes. At an innovation conference organized by the White House STEP, Graham Mitchell of Wharton spoke of lessons from the private sector in a "resource constrained environment" (bureauspeak for "there's never enough money"). One was that defensive research was the arena for models - when most data are known and progress comes in increments - and that action people of fast change live in a world of experiment and learning by doing and juggling options (that seem to shift too often).  The federal mission agencies who use so much of SBIR money for models could take the lesson that models are not the route to innovation; they are the route to improving your understanding of what already works. As thermodynamics was invented to explain the steam engine and form an ever improving base for incremental improvements. 

the American Competitiveness Initiative, called for by President Bush ... has committed $5.9B in the fiscal year 2007 to increase investment in research and development, strengthen education and encourage entrepreneurship, largely through basic research in technology and manufacturing. [Cleveland Plain Dealer, Aug 5]

In Fiasco Thomas Ricks’ says the war on Iraq and subsequent occupation was ill-conceived, incompetently planned and poorly executed. I have no quarrel with that. What dismays me is that anyone expected any different. All wars are full of incompetence, mendacity, fear, and lies. War is big government, authoritarianism, central planning, command and control, and bureaucracy in its most naked form and on the largest scale. The Pentagon is the Post Office with nuclear weapons. [Alex Tabarrok, marginalrevolution, Aug 2]

Rationalizing Public Spending.  Iowa discusses its spending public funds for economic development.  It recognizes that much of the argument for public subsidy is mere camouflage for benefitting politically targeted groups. Simplistic attempts to determine state and local fiscal surplus run the risk of seriously overstating the public revenue yield over total costs and should not be done without extensive research. Unfortunately it is tempting for vendors and decision makers to try to build models that use simple weighted averages to estimate state and local public service cost functions. These simple models rarely can stand much scrutiny, however, before they are determined to be either invalid or simply incorrect. Read about market failure before cheering for programs like SBIR.

climate scientist Andrew Dessler at Texas A&M started a blog  The science and politics of global climate change. You, too, can have an opinion. And the government loves to fund model work with SBIR. Climate models are such fun since they have necessary simplifying assumptions that give the do-nothings a lever. The models are like doughnuts that give the opiners a chance to focus on either the solid or the hole.  The do-nothings don't like to buy insurance and so they reject the precautionary principle and presumably expect that if it goes wrong, the government will bail them out. Conservative until they need government. 

Hugh Hewitt notes that "Bush and his team ... continue to enjoy bedrock support at home and abroad" due to their handling of the war on terror. It's certainly true that Bush is down to his bedrock  Sure, 40% of the electorate will vote for the Republican, no matter what. [Professor Bainbridge blog, Jul 27]

Dept of Energy announced 104 Phase 2 SBIR/STTRs to 78 companies of which 25 awards went to 13 firms that already had a total of something like 1500 Phase 2s. One experienced firm got five awards. Which suggests that Energy acts just like the other mission bureaus in funding R&D that directly serves DOE needs with little regard as to whether the company has the least commercial instinct.  A further clue is the ordinary work shown in the posted vague abstracts. Expected benefit to the economy?  Plenty of blather.

A Bullet for ATP. Senate Appropriations Committee approved ATP's termination in FY07. Not everything good has to be done by the government. SBIR doesn't run the same risk since it gets no direct appropriations. Eventually, slowly, the handout programs have to be whittled down to prevent bigger deficits as the Boomers switch from filling the Treasury to draining it. Maybe a Dem control of Congress in FY07 would resurrect ATP but it still could not avoid the whittling knives. 

PolySci Meets Religion.  Karl Rove –- explaining why Bush planned on vetoing the bill — told the Denver Post that “recent studies” show researchers “have far more promise from adult stem cells than from embryonic stem cells.”  The Chicago Tribune contacted a dozen top stem cell experts about Rove’s claim. They all said it was inaccurate. So who wrote the “studies” that Rove was referring to?  White House spokesman Ken Lisaius on Tuesday could not provide the name of a stem cell researcher who shares Rove’s views on the superior promise of adult stem cells. [Think Progress, Jul 19]

From Washington to Washington any pork money will do.  A proposal to build a new semiconductor and micro device research and development laboratory in Vancouver, Washington recently got a jump start thanks to Congressman Brian Baird.  [who] secured $100,000 in federal funding to be used towards Phase I development of the facility. ... The [money] will come from the Housing and Urban Development Economic Development Initiative’s Facilities Construction/Renovation account.  [Washington Tech Center] Do you think the voters of southwest Washington will thank (and re-elect) their Member while they complain about out-of-control federal deficits?

Must-Pass Legislation. A new federal courthouse to be built in downtown Nashville would be named after Senate Majority Leader Bill Frist under a proposal approved by a Senate committee. [Nashville Tennessean, Jul 25]

Only the Rearview Mirror Works. Every time Alan Greenspan used to go up to the Hill, Sen. Paul Sarbanes (D., Md.) would go though chapter and verse of the Fed forecast of years past and conclude the thing is never right. Mr. Greenspan would always agree. Everybody should view the Fed forecast as just another opinion. It's no better or worse than Merrill Lynch's opinion, for example. [James Bianco, Wall Street Journal interview, Jul 21]

Take Every Chance to Pander. While great issues of finance and world conflict thraten the national stability, our politicians focus on their "base" which itself is focused on "values" - religious questions of no societal impact. Eleven Republican senators who started last week with perfect scores from the National Right to Life Committee Inc. saw them drop to 50% because they supported broader embryonic stem-cell research.  But the dramatic drop was to last for only a matter of days. The senators will have the chance Tuesday to raise their scores with a vote to strengthen states’ parental consent laws. [Wall Street Journal, Jul 24]  They want to get re-elected so they can do nothing for the next 2-4 years. 

Entrepreneuring Pays.  The truth is that there is so much money to be made in smuggling both drugs and people across our southern border that even the tripling of the size and budget of the Border Patrol in the past decade has done little to stem the flow.  [John Fund, WSJ Opinion, Jul 24] Wherever a demand, a supply will arise at the market price. The lessons learned from Prohibition have yet to be absorbed by our politicians who are busy voting against sin.

Three Texas Investments The committee of 17 picked three beneficiaries for $2.25M: $1 million to Endothelix for the development of cardiovascular diagnostic technology; $750,000 to itRobotics  developing inspection robots for tubes in power plants and nonenergy pipelines; and $500,000 to Bauhaus, an animation software company. ... The governor, lieutenant governor and House speaker approve projects for funding. [Austin Statesman-American, Jul 22] Since the $200M fund is still new and hopeful, the politicians take center stage as the governor does the announcing. Later, when the mediocre results come in, the "bureaucrats" can be the symbol.  The role of the usually well-paid and safely employed civil servant is to give the credit to the politicians for what goes right and to take the blame for what does not.

capitalism has not corrupted our souls. It has improved them. ... liberal capitalism is succeeding. says Deirdre N. McCloskey in her Five hundred dense pages of ethical philosophy The Bourgeois Virtues . Reviewer Matt Ridley [Wall Street Journal, Jul 22] says Fashionable thinkers sneer at the free market and its practitioners, but economic liberty may actually be a force for personal goodness and And the bourgeoisie is not entirely a lost cause while it has such able defenders.  If capitalism is succeeding, why do the politicians need to invent programs like SBIR to correct its "market failures"? They don't have to - and it's not the least bit clear that there is a "market failure" in seeding new technology - but they cannot resist high blown rationales for their pork. Anyway, the actual agency management of SBIR doesn't aim at improving capitalism; just at doing what it is told to do with the least damage to what it wanted to do in the first place.

A Merrillism: You can't succeed in government until you acknowledge that it's about representation, not efficiency.  [Washingtonian, Aug 06]

Pork in Space  Congress is shameless in routing pork spending back home. But would Congress gut NASA and de-fund valuable scientific programs in order to fund more pork? The answer is yes: Congress would.  Even the replacement for the space shuttle, a new generation of rockets and launch vehicles due in 2010, is not immune. The projects will have to be put on hold in order to spend billions on specially earmarked pork projects. NASA Administrator Mike Griffin is basically begging Congress to ease up on the pigging out, lest NASA find itself unable to carry out its mission. Then again, a problem with being dependent on a government agency for basic science and space exploration is the political baggage that comes with every decision. You essentially get what you pay for with the government-run model, then you pay again. [USA Today Jun 11 quoted by Reason Express Jun 13] SBIR qualifies as pork: the agency is directed not only what business to do but with whom to do it with no standards for evaluation.

Army Turmoil.  Stand by for an SBIR ground attack - the Army says it will cut its domestic spending to fund overseas combat. [story from Washington Post, Jul 21]  That usually means shuffling funds away from unliked programs, like SBIR, even those mandated by law. The first step would be to freeze SBIR for a while, and award no new contracts or extensions of present contracts. Oh sure, it's mandatory, but so is fighting in Iraq. Only Congress can resolve the conflict and in an election year, a Republican Congress's attention will be elsewhere, as in "values" shows against flag burning and gays. 

More Energy Science.  House and Senate appropriators passed a 14-16% increase for DOE's Energy Science, plus of course $30-48M earmarks for its political friends. See http://www.aip.org/fyi/2006/068.html  Congressional devotion to energy science goes up and down with the price of oil.

More Government Advice on Commercialization.  NIH will continue its Commercialization Assistance Program for SBIR Phase II awardees. The program smells like the DOE program with Dawnbreaker, only NIH is using LARTA as the "teacher". training workshops, individual mentoring and consulting sessions, ending with an opportunity for companies to present their business opportunities to potential investors and strategic partners at the NIH Life Sciences Showcase.  The problem is that the commercialization effort starts only after NIH funds companies with technology geared to government tastes. If NIH were serious about commercialization, it would incorporate commercial potential as a live criterion in its SBIR selection. No chance when selections are made by panels of science experts. While peer review may be great for science, it won't tag good economic potential. But then NIH doesn't need commercial success; it only needs a show for Congress. Details.

Silicon Cabal? The ever-litigious New York AG Spitzer is suing several chip companies for fixing prices on DRAMs. How much free publicity can a gubernatorial candidate get away with? He is just one of 34 states filing their suit in California. Meanwhile, the US Attorney is looking for stock options fraud.

Reinforcing the idea that cool climates make energetic people, Maine's Creative Economy Council estimates that 8.3% of Maine's workforce is made up of creative workers - artists, artisans, engineers, entrepreneurs and researchers. In Maine, this group has an average income 33%higher than the rest of the workforce. How to do it: Maine's Creative Economy Community Handbook: Maine State Government Resources for Communities

Experience Again.  Homeland Security handed out nine Phase 2 SBIRs in its first go-round. By two years ago, four of the nine winners already had a total of at least 1700 SBIRs. Three of the nine had fewer than ten awards each. So, DHS acts like DOD and NASA in furthering its own R&D agenda with little regard to economic potential (although all the veterans probably spun a tale of commercial fantasy that satisfied whatever criteria the agency used). It's an old story: when proposing to mission agencies, tell them some commercial story that they can use to paper over their actual criteria of economic disinterest. The agencies all ignore the idea that  technologies with no economic future can only get developed and used if the government foots the whole bill, and then probably only ever for government service.

Energy for Software.  Tech-X Corp got five more Phase 2 SBIRs from 2005 DoEnergy for software projects to add to its collection of at least 19 Phase 2s in the past few years. Its Phase 1 collection from 2004 DOE was ten projects and from 2003 eleven Phase 1s. That's enough to keep a firm of 23 PhDs and some MSs well devoted to government service.  Prospects for more Phase 2 work should continue good from the eight DOE Phase 1s in 2006 and eight in 2005.  Economic Return on Investment and law of diminishing returns? Only the company and the DOE SBIR managers know because private firms don't have to tell anyone except the government, which is a great tool for preventing outside evaluation of a government program. And there is not much evidence that the government agencies care about ROI anyway.

Semiconductor equipment manufacturers expect a large growth spurt of 18%  in 2006, pushing sales to hit the $35.8 billion mark.. This is in contrast to an 11.3% decline in 2005 according to the SEMI Capital Equipment Consensus Forecast.  [Adrienne Selko, Industry Week, Jul 11]

consultant Ron Leckie concluded that makers of chip equipment and materials will need to spend a total of $16 billion to $20 billion annually on research by 2010 to keep up the pace of innovation. But together, they can only afford about $10.4 billion based on expected revenue. [Don Clark,Wall Street Journal, Jul 8]

Big State, Big Money.  Texas will put up $30M for a regional nanotechnology research institute at the UT Austin, one-thirs each from UT endowment, the state Emerging Tech Fund, and semiconductor companies. [Houston Chronicle, Jul 11]

Government Claims Firewall. a post by Bruce Schneier on his site indicating that the U.S. Navy may be patenting the Firewall. Whether or not it is their intention to do so is unclear. From the patent description: "In a communication system having a plurality of networks, a method of achieving network separation between first and second networks is described. First and second networks with respective first and second degrees of trust are defined, the first degree of trust being higher than the second degree of trust. Communication between the first and second networks is enabled via a network interface system having a protocol stack, the protocol stack implemented by the network interface system in an application layer." [slashdot.com, Jul 7] 

More Science Money.  Bush wants the Congress to spend $130+B more over ten years on basic scientific research and other stuff to boost U.S. competitiveness in the global marketplace through innovation. The other stuff is training thousands more science and math teachers and of course extend the popular R&D tax credit.  Oh sure, sounds good.  But why is it a federal task to train teachers?  A true conservative/libertarian would object to the idea that everything good has to be done by the government. He might alternatively invest no new money (that we don't have anyway) but just put the next decade's $15 billion or so to be spent on SBIR into companies and ideas that will transition high risk technological innovation from the nursery to market-competitiveness. For that, he would have to kick the mission agencies into a new mode of thinking about economic security and how to get technology that private capital will pay to develop.

Hopeful start, then budget decline. The taxpayers of Schenectady NY cut the subsidy for the six-year old business incubator, Metroplex Chairman Ray Gillen said his