R&D outlook: Defense Department should refocus technology spending, experts warn.

• Author: Erwin, Sandra I.
• Position: ANALYSIS

THE PENTAGON'S RESEARCH AND DEVELOPMENT BUDGET HAS NEVER been bigger. Despite such largesse, investments in technology tend to miss the mark and do little to enhance the United States' competitive standing as a high-tech powerhouse, said Pentagon advisors and outside analysts.

Defense research and development budgets will exceed $80 billion in fiscal year 2008, of which about $12 billion will be allocated to long-term science and technology projects. Most of the funds pay for so-called "applied research" for near-term needs--including modifications of existing weapon systems and war-related projects such as technologies to help troops detect and disarm roadside bombs.

But despite a steady rise in R&D spending, the Defense Department has not been able to replicate the technological success witnessed during the Cold War, when the Pentagon delivered a string of breakthrough technologies that, to this day, continue to provide military forces major advantages, such as unmanned aircraft, cruise missiles, stealth and Global Positioning System satellites.

The problem today appears to be a "lack of strategic direction," said an April 2007 report by the Defense Science Board, a senior-level advisory panel.

"The Defense Department science and technology programs are not well positioned to meet the nation's strategic challenges," the panel wrote. Further, the Pentagon "needs to understand the technological possibilities available to the United States and the options available to adversaries."

R&D funding priorities come under particularly tough criticism from the science board. The panel carps repeatedly about the Defense Department cutting science and technology budgets and shifting funds to applied research and other accounts. While these financial maneuvers may help pay for immediate needs, they undermine long-term U.S. strategic goals, the DSB said. "In recent years, there has been a shift in Defense Department R&D from research into development."

During the past 40 years, the panel said, "The resources devoted to basic research have been cut in half, as a percentage of Defense Department science and technology (S&T) funding, from 25 to 12 percent."

As a result, in many science and technology fields, the Defense Department no longer leads the world. According to the DSB, among G-8 nations, 50 percent of S&T investments are made outside the United States, 36.5 percent by U.S. commercial firms, 7 percent by other U.S. government agencies and 6.5...